Mill Bay, Canada Short-Term Rental Regulation: A Guide For Airbnb Hosts

Starting a Short-Term Rental Business in Mill Bay

If you're considering starting a short-term rental business in Mill Bay, Canada, it's crucial to understand the local regulations and zoning bylaws. As of 2024, the Cowichan Valley Regional District (CVRD), which includes Mill Bay, has implemented new rules in response to British Columbia's Bill 35.

Under these regulations, most residentially-zoned parcels in the CVRD do not permit short-term rentals. In fact, fewer than 100 parcels throughout the CVRD allow STRs, including the CD-5 Zone in Mill Bay (Sandy Beach Cottages). Traditional bed and breakfasts (B&Bs) are generally permitted in most residential zones, provided the owner or operator resides within the dwelling and serves breakfast to guests.

It's important to note that the CVRD has opted into the province's principal residence requirement for six electoral areas, including Electoral Area A (Mill Bay/Malahat). This means that STRs in these areas are restricted to the host's principal residence, plus one secondary suite or accessory dwelling unit on the same property.

To determine if your property permits the use of a short-term rental, consult the South Cowichan Zoning Bylaw and contact the CVRD Development Services at ds@cvrd.bc.ca.

It's worth noting that farm-class properties are exempt from the new STR regulations, even if a local government has chosen to opt in. This aligns with the 2021 provincial change in farm housing governance, allowing owners of Agricultural Land Reserve properties to build a second home or suite for rental, farm worker lodgings, agritourism, or non-farm use by extended family members, subject to local zoning regulations.

As the province continues to roll out additional information on the new short-term rental rules, the CVRD is exploring proactive strategies, such as business licensing, to efficiently regulate STRs while supporting the tourism economy and minimizing negative impacts on established neighborhoods.

Navigating these new regulations can be challenging, but by staying informed and engaging with local authorities, you can ensure your short-term rental business in Mill Bay operates within the legal framework. For the most up-to-date information, refer to official announcements from the CVRD and the Province of British Columbia.

Short-Term Rental Licensing Requirements in Mill Bay, Canada

As of July 2024, the Cowichan Valley Regional District (CVRD) is exploring the implementation of a business licensing program for short-term rentals (STRs) in Mill Bay and other areas within its jurisdiction. While the specific details are still being finalized, here's what we know so far based on the information provided by the CVRD:

• Eligibility: To be eligible for an STR license in Mill Bay, your property must be located in a zone that permits short-term rentals, such as the CD-5 Zone (Sandy Beach Cottages). Most residentially-zoned parcels do not allow STRs.
• Application Process: Once the licensing program is in place, you will need to submit an application to the CVRD Development Services department. The application will likely require proof of ownership, a site plan, and other relevant documentation.
• Fees: The CVRD has not yet announced the specific fees associated with obtaining an STR license in Mill Bay. However, based on similar programs in other municipalities, you can expect to pay an initial application fee and an annual renewal fee.
• Timeline: The processing time for STR license applications in Mill Bay has not been determined. The CVRD is currently working on the details of the licensing program and will provide more information as it becomes available.
• Penalties: Operating an STR without a valid license in Mill Bay may result in fines and other penalties. The exact amounts and enforcement measures are still being developed by the CVRD.

It's important to note that the STR licensing requirements in Mill Bay are subject to change as the CVRD continues to refine its regulations in response to the province's new legislation (Bill 35). For the most up-to-date information, visit the CVRD website and the Plan Your Cowichan portal.

If you have specific questions about the licensing process or the eligibility of your property, contact the CVRD Development Services department at ds@cvrd.bc.ca.

Required Documents for Mill Bay, Canada Short-Term Rentals

As of July 2024, the Cowichan Valley Regional District (CVRD) has not yet finalized the specific licensing requirements and documents needed to operate a short-term rental (STR) in Mill Bay. However, based on the current zoning regulations and the ongoing discussions about implementing a business licensing program, here are some key points to consider:

1. Zoning Compliance: Before applying for any permits or licenses, you must ensure that your property is located in a zone that allows short-term rentals. Most residentially-zoned parcels in Mill Bay do not permit STRs, with the exception of the CD-5 Zone (Sandy Beach Cottages). Contact the CVRD Development Services department at ds@cvrd.bc.ca to confirm your property's zoning and eligibility for STRs.
2. Building Permits and Inspections: If you plan to construct, alter, or renovate a building or structure to accommodate an STR, you may need to obtain building permits and pass inspections to ensure compliance with the British Columbia Building Code and the CVRD Building Bylaw. Submit your building permit application, along with the required plans and fees, to the CVRD office at 175 Ingram Street, Duncan, or by email to inspections@cvrd.bc.ca.
3. Proof of Ownership: When applying for an STR license or permit, you may be required to provide proof of ownership for the property, such as a title deed or property tax assessment.
4. Site Plan: A detailed site plan showing the location of the STR unit on the property, parking arrangements, and any other relevant features may be required as part of the application process.
5. Business License: Once the CVRD implements a business licensing program for STRs, you will likely need to obtain a valid business license and pay the associated fees. The specific requirements and application process will be determined by the CVRD in the coming months.
6. Transient Occupancy Tax: STR operators in Mill Bay may be required to collect and remit a transient occupancy tax (TOT) to the CVRD. More information on the TOT registration process and payment methods will be provided by the CVRD as the STR regulations are finalized.

As the CVRD continues to develop its short-term rental regulations and licensing program, it is crucial to stay informed about the latest requirements and deadlines. Regularly check the CVRD website and the Plan Your Cowichan portal for updates, and contact the CVRD Development Services department with any specific questions or concerns.

Mill Bay, Canada Short-Term Rental Taxes

As a short-term rental operator in Mill Bay, British Columbia, it's essential to understand the various taxes that apply to your business. Here's a breakdown of the key tax types and their rates:

1. Provincial Sales Tax (PST): The PST is an 8% tax that applies to all short-term accommodations in British Columbia, unless a specific exemption applies. This tax is charged on the total purchase price of the accommodation, including any additional fees such as cleaning or service fees.
2. Municipal and Regional District Tax (MRDT): The MRDT is an additional tax that applies to short-term accommodations in participating areas of British Columbia. The tax rate varies by location but is typically up to 3%. In Mill Bay, which is part of the Cowichan Valley Regional District, the MRDT rate is 2%. This tax is charged on top of the PST and is used primarily for tourism marketing, programs, and projects.
3. Goods and Services Tax (GST): The GST is a federal tax that applies to most goods and services in Canada, including short-term rentals. The current GST rate is 5%. As a short-term rental operator, you may be required to register for and collect GST if your annual revenue exceeds $30,000. However, you can also choose to voluntarily register for GST, which allows you to recover the GST paid on purchases and expenses related to your rental business.

It's important to note that starting May 1, 2024, British Columbia is implementing new regulations that limit short-term rentals to the host's principal residence, plus one secondary suite or accessory dwelling unit. This change may impact your eligibility to operate a short-term rental in Mill Bay and could affect your tax obligations.

Potential Deductions and Write-Offs

As a short-term rental operator, you may be able to deduct certain expenses from your rental income, reducing your overall tax liability. Some potential deductions include:

1. Property taxes
2. Mortgage interest
3. Utilities
4. Insurance
5. Repairs and maintenance
6. Cleaning and supplies
7. Advertising and marketing expenses
8. Professional fees (e.g., accountants, lawyers)
9. Depreciation of rental property and equipment

To claim these deductions, you'll need to keep accurate records of your income and expenses throughout the year. Consult with a tax professional to ensure you're maximizing your deductions and complying with all applicable tax laws.

In summary, short-term rental operators in Mill Bay, British Columbia, are subject to the 8% PST, 2% MRDT, and potentially the 5% GST. By understanding these taxes and taking advantage of available deductions, you can better manage your rental business and minimize your tax burden.

British Columbia Wide Short-Term Rental Rules

In addition to the local regulations in Mill Bay and the Cowichan Valley Regional District, short-term rental hosts must also comply with province-wide rules set out in British Columbia's new Short-Term Rental Accommodations Act (STRAA), which took effect on May 1, 2024.

Under the STRAA, short-term rentals of less than 90 days are restricted to a host's principal residence, plus one secondary suite or accessory dwelling unit on the same property. This Principal Residence Requirement applies to designated municipalities with a population over 10,000, as well as some smaller adjacent communities like Mill Bay.

The STRAA also removes protections for legal non-conforming use of short-term rentals in areas where updated local bylaws prohibit this type of use. This means that even if a property was previously allowed to operate short-term rentals, it may no longer be permitted under the new provincial legislation and local zoning changes.

Short-term rental platforms like Airbnb and VRBO are now required to share data with the provincial government. Hosts must display a valid business license number on their listings, and municipalities can request that platforms remove listings without proper licenses.

To enforce these new rules, the province has established a Short-Term Rental Compliance and Enforcement Unit. This unit will investigate alleged violations and can issue fines ranging from $500 to $5,000 per infraction for individual hosts, and up to $10,000 per infraction for corporations. Guests will not be subject to any fines.

It's important to note that while the STRAA sets a provincial framework, local governments can still implement their own bylaws that are more restrictive. Some smaller communities have opted into the Principal Residence Requirement even though they are exempt based on population.

As a short-term rental host in Mill Bay, it is crucial to stay informed about both the STRAA and the evolving local regulations in the Cowichan Valley Regional District. Consult with local authorities and legal professionals to ensure your short-term rental operates in compliance with all applicable laws.

Does Mill Bay Strictly Enforce STR Rules?

Based on discussions in online real estate investing forums like Bigger Pockets and Reddit, it appears that Mill Bay and the broader Cowichan Valley Regional District (CVRD) are not particularly Airbnb-friendly compared to some other Canadian cities and regions. The CVRD has opted into British Columbia's new principal residence requirement for short-term rentals in six of its nine electoral areas, including Mill Bay/Malahat.

Under these rules, which take effect November 1, 2024, in the opted-in areas, short-term rentals are restricted to a host's principal residence plus one additional dwelling unit on the same property. This significantly limits the ability to operate STRs in secondary homes or investment properties in Mill Bay.

Furthermore, the CVRD's zoning bylaws are quite restrictive when it comes to short-term rentals. Fewer than 100 parcels in the entire CVRD are zoned to permit STRs, with most residential zones not allowing this use. The CD-5 Zone in Mill Bay (Sandy Beach Cottages) is one of the few areas where STRs are permitted.

Many hosts on real estate forums have expressed frustration with these limitations and the strict enforcement. The CVRD has indicated it will be working closely with the province's new Short-Term Rental Compliance and Enforcement Unit to identify and fine non-compliant listings once the regulations fully kick in. Fines can range from $500-$5000 per infraction for hosts.

So, in summary, Mill Bay and the CVRD appear to be cracking down hard on short-term rentals that don't comply with the principal residence requirement and restrictive zoning. The consensus among Airbnb hosts is that it's not a very STR-friendly area compared to other popular BC destinations. While some hosts may still attempt to operate under the radar, the risk of enforcement and penalties is high. Overall, Mill Bay seems committed to prioritizing long-term housing over vacation rentals in its community.

How to Start a Short-Term Rental Business in Mill Bay

Starting a short-term rental business in Mill Bay, Canada, requires careful planning and adherence to local regulations. Here's a step-by-step guide to help you get started:

1. Determine Eligibility: Check if your property is located in a zone that permits short-term rentals. In Mill Bay, which is part of the Cowichan Valley Regional District (CVRD), most residentially-zoned parcels do not allow STRs. Notable exceptions include the CD-5 Zone (Sandy Beach Cottages). Contact the CVRD Development Services at ds@cvrd.bc.ca to confirm your property's zoning and eligibility.
2. Comply with the Principal Residence Requirement: As of November 1, 2024, Mill Bay will be subject to British Columbia's principal residence requirement. This means STRs will be restricted to your primary residence, plus one secondary suite or accessory dwelling unit on the same property. Plan accordingly if you intend to operate an STR in a secondary home or investment property.
3. Obtain Necessary Permits and Licenses: Once the CVRD implements its STR licensing program, you will need to apply for a business license and pay the associated fees. Display your valid license number on all online listings. Failure to do so may result in fines and penalties.
4. Prepare Your Property: Ensure your STR meets all safety standards and is equipped with necessary amenities. This may include smoke and carbon monoxide detectors, fire extinguishers, and adequate parking. Consider hiring a professional to inspect your property and make any required upgrades.
5. Create a Comprehensive Listing: Craft an attractive and informative listing on popular STR platforms like Airbnb and VRBO. Include high-quality photos, detailed descriptions, and accurate information about your property's features, location, and house rules. Be transparent about any limitations or quirks to manage guest expectations.
6. Develop a Pricing Strategy: Research comparable STRs in Mill Bay to determine a competitive nightly rate. Consider factors like seasonality, events, and demand when setting prices. Utilize dynamic pricing tools to automatically adjust rates based on market conditions.
7. Establish Guest Communication Protocols: Provide prompt and professional responses to inquiries and bookings. Clearly communicate check-in/out procedures, house rules, and any other important information. Be available to address guest concerns throughout their stay.
8. Implement a Cleaning and Maintenance Plan: Maintain high standards of cleanliness and upkeep to ensure positive guest reviews. Hire a reliable cleaning service or develop a thorough cleaning checklist. Conduct regular inspections and address any maintenance issues promptly.
9. Provide a Statement of Conditions: As required by the CVRD, provide each guest with a statement of conditions that includes the maximum occupancy, parking information, emergency contact details, trash disposal instructions, noise ordinance requirements, and a reminder to be a good neighbor.
10. Stay Informed and Adapt: Keep abreast of any changes to Mill Bay's STR regulations and adapt your business practices accordingly. Engage with local authorities and join STR host communities to stay informed and share best practices.

By following these steps and prioritizing guest satisfaction, you can build a successful short-term rental business in Mill Bay, Canada. Remember to always operate within the legal framework and be a responsible host to maintain positive relationships with guests, neighbors, and the broader community.

Who to Contact in Mill Bay about Short-Term Rental Regulations and Zoning?

To inquire about short-term rental regulations and zoning in Mill Bay, your primary contact should be the Cowichan Valley Regional District (CVRD) Development Services department. They can help you determine if your property is eligible for short-term rentals under current zoning bylaws.

Contact CVRD Development Services:

1. Email: ds@cvrd.bc.ca
2. Phone: 250-746-2620
3. Address: 175 Ingram Street, Duncan, BC V9L 1N8

For building permits, inspections, and code compliance related to short-term rentals, reach out to the CVRD Building & Bylaw Enforcement Services:

1. Email: inspections@cvrd.bc.ca
2. Phone: 250-746-2610

Stay informed about evolving short-term rental regulations in Mill Bay and the CVRD by regularly checking official sources:

1. CVRD Website: https://www.cvrd.ca/
2. Plan Your Cowichan Portal: https://www.planyourcowichan.ca/new-provincial-housing-short-term-rental-legislation

As a short-term rental host in Mill Bay, you may find it helpful to connect with other local hosts and share experiences, tips, and advocacy efforts. While there doesn't appear to be a Mill Bay-specific group, here are some online communities to check out:

1. Airbnb Community Center - British Columbia Clubs: https://community.withairbnb.com/t5/British-Columbia/ct-p/ca-british-columbia
2. Airbnb Hosts Forum: https://airhostsforum.com/
3. Bigger Pockets Short-Term and Vacation Rental Forum: https://www.biggerpockets.com/forums/530-short-term-and-vacation-rental

Remember, regulations are subject to change, so it's crucial to stay engaged with local authorities and host communities to ensure your short-term rental business remains compliant and sustainable in Mill Bay.

What Do Airbnb Hosts in Mill Bay on Reddit and Bigger Pockets Think about Local Regulations?

Based on discussions in online forums like Reddit and Bigger Pockets, it appears that short-term rental hosts in Mill Bay and the broader Cowichan Valley Regional District (CVRD) have mixed feelings about the evolving local regulations:

Frustration with Restrictive Zoning: Some hosts express frustration that the CVRD's zoning bylaws are quite limiting, with fewer than 100 parcels in the entire district allowing short-term rentals. The consensus is that most residential zones in Mill Bay do not permit STRs, making it challenging to operate legally.

Concerns about the Principal Residence Requirement: With Mill Bay opting into British Columbia's new principal residence requirement starting November 1, 2024, hosts worry about the impact on their ability to offer STRs in secondary homes or investment properties. This change is seen as a significant blow to those relying on short-term rental income.

Uncertainty around Licensing and Enforcement: As the CVRD works on implementing a business licensing program for STRs, hosts are anxious to learn more details about the application process, fees, and enforcement measures. Some fear that the licensing requirements and potential penalties for non-compliance may be overly burdensome.

Desire for Balanced Regulations: While acknowledging the need to address housing affordability and community concerns, some hosts argue that STRs play a vital role in supporting Mill Bay's tourism economy. They hope to see a more balanced approach that allows responsible STR operators to continue contributing to the local community.

Interest in Advocacy and Engagement: Recognizing the importance of staying informed and having a voice in shaping local policies, some Mill Bay hosts are actively seeking out online communities and resources to connect with fellow operators, share experiences, and engage with local authorities.

Overall, the sentiment among Airbnb hosts in Mill Bay seems to be one of apprehension and uncertainty as they navigate the changing regulatory landscape. While some express frustration with the restrictions, others are focused on finding ways to adapt and ensure their short-term rental businesses remain viable and compliant.

Disclaimer: While we here at BNBCalc strive to keep all of our city regulation guides updated and accurate with all the latest local laws, we still do not suggest using them as your sole or primary source for local regulations. We also do not recommend you rely on the third-party sources we link to or reference, and we are not responsible for any of the information on these third-party sites. These guides are for entertainment purposes only and only provide basic information and should not be considered as legal advice.

We highly recommend directly contacting the responsible parties for each city and hearing what their officials have to say. Ultimately, it's your responsibility as an investor to ensure you fully comply with the local laws, and it's best to speak with professionals before making an investment decision.