Have you heard about Staycation Tax Credit? It is a renowned and popular topic that has gained quite a lot of interest. To give you an overview of the Ontario Staycation Tax Credit, citizens can get a tax rebate on their travel. So, you can save on taxes by traveling. Isn’t that awesome?
The Ontario Staycation tax credit for the year 2022 was basically introduced to help the hospitality and tourism industry get back to the way they were before the Covid. So, promoting travel and giving people tax lenience is a great way to promote travel within the province. So, if you are a citizen in Ontario, here is everything that you should know about the Staycation tax credit.
While submitting the personal Income Tax and Benefit Return for 2022, residents of Ontario may deduct 20% of their allowable 2022 lodging costs, such as those associated with a stay at a hotel, cottage, or campsite. In addition, you can obtain up to $200 back as an individual or $400 back as a family by deducting up to $1,000 in eligible costs or $2,000 if you have a spouse, common-law partner, or eligible children. This credit will provide roughly $270 million help to more than 1.85 million families in Ontario.
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Who are eligible
If you are a resident of Ontario as of December 31, 2022, you are qualified to apply for the credit.
Each family is limited to one claimant for the entire year. The qualifying costs incurred by your spouse, common-law partner, and eligible children may be included in your claim. A youngster who is qualified cannot claim the credit. You can claim your eligible expenses for the staycation tax credit if you don’t have a spouse, common-law partner, or eligible child.
Eligible expenses
The Ontario Staycation Tax Credit is available for lodging costs incurred during a short-term stay or camping trip in Ontario for leisure purposes, including:
- hotel
- motel
- resort
- lodge
- bed-and-breakfast establishment
- cottage
- campground
- vacation rental property
No matter when the stays were paid for, the tax credit only applies to leisure stays between January 1 and December 31, 2022.
You, your spouse, common-law partner, or qualifying child must have paid the lodging costs as shown on a comprehensive receipt given by a provider registered for the Goods and Services Tax (GST)/Harmonized Sales Tax (HST).
You may deduct any of the following costs provided that all other requirements are satisfied:
lodging for a single trip or several visits, with a staycation tax credit, you can get up to $1,000, the maximum spending cap for an individual, or $2,000 for a family lodging reserved directly with the lodging provider or through an online lodging platform the percentage of the cost required to gain access to the lodging the cost of the hotel element of a trip package
You must preserve your thorough receipts for any eligible expenses you want to claim for the credit. These receipts have to contain:
- Where the accommodations are located
- The sum that can be deemed to be for the accommodation portion of a visit, along with any GST or HST that may have been paid, the duration of the stay, and the payor’s name.
Ineligible expenses
Now, before you pack your bag and go traveling, there are also things that you should know which doesn’t fall under the expenses that aren’t eligible for a staycation tax deduction.
- You cannot avail tax credit for the following.
- Expenses for car rentals, fuel, flights, groceries, parking, or the cost of admission to nearby attractions and points of interest that are not for short-term lodging or camping accommodations.
- Expenses are reimbursed to you, your spouse or common-law partner, or your eligible child by anyone, including a friend or an employer.
- Expenses are incurred for school or educational purposes, work, employment, or business.
Traveling locally save money
When making travel plans, many people fail to consider local options. Instead, they picture skies, white sand beaches, far-off places, etc. But for a lot less money, there is a lot to discover right in our own backyards.
How many of us have entertained visitors from other countries and inquired about their travel plans in Ontario? The common responses involve places like Toronto, the CN Tower, Niagara Falls, Ottawa, Tobermory, etc.
These are all fantastic sights, but how likely are they to appear on our own lists once most of us begin making travel or weekend plans?
Some of us might believe that visiting these quaint and lovely sites requires an excuse, such as entertaining guests or hosting out-of-town relatives and family. But, for instance, I haven’t been to St. Jacobs Market or Niagara Falls since I had visitors from England in 2016.
Travel expenses are reduced when we spend our vacation time locally, which also supports some local businesses that might use the support (e.g., flights, insurance, exchange rates, etc.).
Traveling to a different Ontario town, city, or region might be a terrific workaround if you’re on a tight budget but could use a vacation, especially if you enjoy camping.
Important dates to remember
Your relaxing vacation must take place between January 1 and December 31, 2022, to qualify for this tax credit. So, bear in mind to save your receipts! For further information, you can look into the Ontario Staycation Tax Credit.
How to avail of Ontario Staycation tax credit?
It is fairly simple to claim a tax credit. Assuming you are fulfilling every need mentioned above, you can claim the Staycation tax credit while filling your personal income tax and benefit return for the year 2022.
The Ontario staycation is a refundable tax credit. This simply means you will get a tax return even if you owe income tax for 2022.
So, this is a new way the government is promoting local travel and helping develop the current condition of the Hospitality and food industry. So, have you decided where to go? If you fall short of any funds, you can always rely on PrestoCash to provide you instant online loans and help you plan your trip.