Most residential property managers in Canada have questions about how GST/HST applies to their operations. This guide explains the rules and how Propra handles GST/HST automatically so your accounting stays accurate and compliant.
Is Residential Rent Subject to GST/HST?
No, residential rent is GST/HST exempt, which means;
GST/HST is not charged to tenants
ITCs (input tax credits) for GST/HST paid on expenses related to exempt residential properties cannot be claimed, even if an owner claims GST/HST for other part's of their business
How to treat GST/HST for residential properties
GST/HST must be charged on a service or product based on Canada Revenue Agency's regulations. As a result, when charging management fees, mark ups, maintenance billing or other services to a residential property GST/HST is added to the bill. It is required to display the GST/HST amount and your GST/HST number on the copy of the bill.
Propra records the property's financial statements so that they are accurate for tax preparation. When recording the accounting entry for bills and expenses, the GST/HST is rolled up into the total expense amount for residential properties. This is because the GST/HST is part of that expense category for the property and should be included for their income tax documents.
How Propra Manages GST/HST Automatically
Propra is designed to simplify GST/HST accounting for property managers:
For scanned bills, automatically detects and splits GST/HST on supplier bills for commercial properties only
Commercial properties have their GST/HST charges and ITC credits put to a liability account to track how much should be remitted to the government
Creates GST/HST bills for remittences
Ensures rent invoices follow GST/HST-exempt rules
Generates clear statements showing GST/HST-inclusive totals
Generates management fee, mark up and maintenance bills with GST/HST amount listed in the owner's portal
Keeps expense records audit-ready
Reduces manual entry and errors
With Propra, you can confidently handle GST/HST on expenses while ensuring rent remains compliant and consistent every month.
If you have questions about how this applies to your portfolio, our support team is always here to help.