Do you have rental income or business income?

To determine whether your rental income is from property or from business, consider the number and kinds of services you provide for your tenants.

In most cases, you are earning income from property if you rent space and provide basic services only. Basic services include heat, light, parking, and laundry facilities.

If you provide additional services to tenants, such as cleaning, security, and meals, you may be carrying on a business. The more services you provide, the greater the chance that your rental operation is a business.

For more information about how to determine if your rental income is income from property or income from business, see, Interpretation Bulletin IT-434R, Rental of Real Property by Individual and its Special Release.

Note
If you determine that your rental operation is a business, see Sole proprietorships and partnerships. You will have to use Form T2125, Statement of Business or Professional Activities, in Guide T4002, Business and Professional Income, to calculate your business income and expenses.

Forms and publications

• Guide T4002, Business and Professional Income
• Guide T4036, Rental Income
• Form T2125, Statement of Business or Professional Activities
• Form T776, Statement of Real Estate Rentals
• Interpretation Bulletin IT-434R, Rental of Real Property by Individual
• Interpretation Bulletin IT-434RSR, Rental of Real Property by Individual

Related topics

• Sole proprietorships and partnerships