Short-Term Rental Regulations in Alberta

Anyone interested in operating a short-term rental business in Alberta needs to be familiar with the province’s regulations to avoid potential fines and be a responsible businessperson. The two key aspects to understand are the provincial tourism levy and municipal regulations. This overview explains the former and delves into two examples of the later, using the provinces two largest cities as examples.

Province-wide regulations: Alberta’s tourism levy

Alberta will soon implement a province-wide tourism levy, which will be 4% of the purchase price. Starting July 1, 2023, STR operators, accommodation hosts and online brokers in Alberta will be required to collect, remit and report the levy. You can register for it online.

Exemptions from the tourism levy

Certain individuals or entities are exempt from paying the tourism levy if they provide valid evidence of entitlement to the exemption at the time of purchasing accommodation. The following exemptions apply to people who belong to the following types of organizations:

• The Government of Canada
• Persons specified in the Diplomatic, Consular, and Other Representatives in Canada listing published by the Government of Canada
• Persons with the armed forces of another country stationed in Canada
• Countries, states, political subdivisions, agencies, or accredited persons representing those entities, provided the operator receives certification that the accommodation is for official use
• Indigenous individuals or bands if the accommodation is provided on a reserve in Alberta for the use of the individual or band

Exempt situations

Additionally, there are specific situations where the tourism levy doesn’t apply. This includes, among others, accommodations occupied by the same individual continuously for 28 days or more and accommodations with a purchase price of less than $30 per day or $210 per week that are not listed on an online marketplace.

For more information

Municipal regulations

The province allows municipalities to set their own rules for short-term rentals. Here are two examples to give you an idea of what to expect.

Calgary

In Calgary, short-term rental (STR) hosts are subject to specific regulations and licensing requirements. The City Council has approved changes to the Business Licence Bylaw to enforce business licensing and regulations for STR hosts in Calgary. These regulations aim to ensure safety, transparency and accountability in the short-term rental industry. Additionally, the city provides guidelines for both hosts and guests through resources like the Good Host Guide.

Short-term rental definition

A short-term rental is defined as providing temporary accommodation for compensation in a home or a part of a home for up to 30 consecutive days. It’s important to note that businesses with a bed and breakfast permit are not classified as short-term rentals.

Short-term rentals in secondary suites

The city defines secondary suites as self-contained dwelling units within principal residences or backyards that have their own entrances and separate living, cooking, sleeping and bathroom facilities. They can also be rented as short-term rentals. However, to use a secondary suite as a short-term rental, it must meet the requirements for a legal secondary suite, and the host must obtain a short-term rental licence. Further information on secondary suites can be found here.

Short-term rental business licence costs

Calgary has a two-tiered licensing system for short-term rentals. Hosts must obtain a separate short-term business licence for each property they rent out. The costs for each tier are as follows:

• Tier 1: For hosts offering 1 to 4 rooms for rent, the licence fee is $100 per property.
• Tier 2: Hosts offering 5 or more rooms for rent must pay a licence fee of $172 per property. Additionally, a fire inspection is required before the licence is issued, costing $104 per property.

Regulations for short-term rental hosts

Short-term rental hosts in Calgary must comply with several regulations outlined in the Business Licence Bylaw. These regulations include the following:

• **Egress: **Hosts are not allowed to rent a room that does not have one or more egress windows, except in multi-storied apartment/condo buildings where fire safety standards are already in place.
• Maximum number of guests: A host cannot allow more than two adults per room, excluding minors. The bylaw does not cover longer-term stays exceeding 30 days.
• **Overlapping bookings: **Hosts cannot schedule overlapping bookings, meaning separate rooms cannot be rented out to separate guests under separate reservations. However, multiple rooms can be rented out as part of one guest reservation.
• **Advertising: **Hosts must include their business licence number in any advertising for their short-term rental property.
• Emergency contact: Hosts must prominently display the name, phone number and email address of an emergency contact person who can be reached 24/7.
• **Guest record: **Hosts are required to keep a record in English in an electronic form satisfactory to the chief licence inspector. This record must include the full name and email address of each paid guest along with the duration of their stay. Hosts must provide these records to the inspector upon request.

Fines for non-compliance

The City of Calgary prioritizes voluntary compliance with bylaws, working with hosts to ensure adherence. However, failure to comply with the regulations can result in fines upon conviction. The bylaw specifies fines of $1,000 for each offence.

Edmonton

Edmonton, the capital city of Alberta, has implemented regulations to govern the operation of short-term rentals. STRs are defined as residential rental accommodations for a duration of 30 consecutive days or less.

Licensing and business licence requirements

To operate as a short-term rental operator, individuals must obtain a tier 2 business licence, which costs $95.

Types of short-term residential rental accommodations

There are two main types of short-term residential rental accommodations:

1. Rental of an entire dwelling, such as a house or apartment, for short-term stays.
2. Rental of individual rooms or spaces in a home: Hosts in this category reside in the property while renting out individual rooms or spaces to guests.

Application process and additional permits

To obtain a business licence for short-term home rental, interested individuals must complete the following steps:

• Apply online: Submit an application for a home-based residential rental accommodation (Short-Term) business licence, selecting the appropriate licence type.
• Condominium/homeowner association bylaws: Before applying, hosts must ensure that the condominium or homeowner association bylaws permit short-term home rentals. Checking these bylaws is the host’s responsibility.
• Licence fee: Pay the applicable licence fee, which is currently $95.
• Operational plan: Provide a completed operational plan specifically outlining guest management for short-term residential rental accommodations.
• Development permit: If the operator/host resides at the rental premises and plans to rent out more than two sleeping units, they must obtain a development permit for a major home-based business. This requirement extends to situations where the rental accommodation is a separate basement or garden suite.
• Building permit: A building permit may be necessary if modifications to the property’s physical floor plan are required to accommodate the short-term residential rental accommodation, such as adding a new bedroom or finishing a basement.
• Guest information: Operators must provide guests with a copy of the Short-Term Residential Rental Accommodation: Information for Guests guide.

Health and other permit requirements

In addition to the above-mentioned licensing and permit requirements, hosts planning to develop a secondary suite or garden suite must obtain a development permit and building permit before commencing any construction. Similarly, a building permit is necessary for any residential construction inside the home to accommodate short-term residential rentals, such as adding a new bedroom or finishing a basement.

Compliance with health regulations

Once a licence is issued, the City of Edmonton notifies Alberta Health Services. Alberta Health Services may conduct follow-up inspections to ensure compliance with health regulations related to short-term residential rental accommodations.

Learn more here

In Alberta, short-term rental operators must have a thorough understanding of local regulations. This ensures compliance, responsible practices and positive guest experiences. If you’re thinking getting into the STR business, be sure to get the latest information on the tourist levy and check with your municipal government about its regulations.