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

Starting a Short-Term Rental Business in Ucluelet

Ucluelet, a small coastal town on Vancouver Island in British Columbia, has seen a rapid increase in short-term rentals (STRs) through platforms like Airbnb and VRBO in recent years. However, the municipality has implemented new regulations to manage the growth of STRs and prioritize long-term housing for residents.

As of September 2022, Ucluelet amended its zoning bylaws to limit new bed and breakfasts (B&Bs) to the following:

• Maximum of 3 guestrooms per building
• Maximum of 2 guests per room
• No fully equipped kitchenettes allowed in guestrooms
• Guests must use the home's main entrance, not a separate entry

The new rules aim to encourage "traditional B&Bs" where the owner lives on-site, rather than entire homes being used as vacation rentals. Existing licensed STRs are grandfathered under the previous rules.

To start a short-term rental in Ucluelet, property owners must:

Ensure their property is in a zone that allows B&Bs or vacation rentals. Most residential zones permit B&Bs as a secondary use, while some areas like the Village Square allow STRs as a principal use.

Apply for a business license from the District of Ucluelet. The application requires proof of ownership, a floor plan, parking plan, and a fire and safety inspection.

Collect and remit the 8% PST and up-to-3% MRDT taxes on all bookings.

Follow all other municipal bylaws related to noise, parking, occupancy limits, etc.

Fines for operating without a license or violating STR regulations can reach $1,000 per day. The District conducts proactive enforcement and responds to complaints.

Short-Term Rental Licensing Requirement in Ucluelet

To legally operate a short-term rental (STR) in Ucluelet, property owners must obtain a business license from the District. The licensing process ensures that STRs meet zoning, safety, and operational requirements. Here are the key steps and details:

Zoning Compliance: Check that your property is located in a zone that allows STRs. Bed and Breakfasts (B&Bs) are permitted in most residential zones, while Vacation Rentals (VRs) are only allowed in certain commercial and mixed-use zones. Contact the Planning Department at (250) 726-7744 or info@ucluelet.ca to confirm your zoning.

Application Form: Complete the Business License Application form, available online at https://ucluelet.ca/community/planning-building-bylaw/business-licensing or in-person at the District Office (200 Main Street). The form requires:

1. Owner contact information
2. Property address and legal description
3. Number and configuration of rental rooms/units
4. Number of on-site parking spaces
5. Proposed occupancy and operational details

Floor Plan: Provide a detailed floor plan of the STR, clearly labeling the location and dimensions of all bedrooms, bathrooms, kitchen facilities, and exits. The plan must demonstrate compliance with occupancy limits and fire safety requirements.

Parking Plan: Submit a site plan showing the location and number of off-street parking spaces dedicated to the STR use. At least one space per rental room is typically required.

Fire and Safety Inspection: Schedule a fire and life safety inspection with the Ucluelet Fire Department by calling (250) 726-7744. The inspector will verify that the property has working smoke and carbon monoxide alarms, fire extinguishers, and adequate exits. A fee of $50 applies.

Strata Approval (if applicable): If the property is part of a strata, provide written approval from the strata council confirming that STR use is permitted under the bylaws.

Application Fee: Pay the initial business license application fee of $150, plus $150 for each additional guest room over one. Annual renewal fees are $200 for B&Bs and $300 for VRs.

Submission and Processing: Submit the completed application package in-person or by mail to the District of Ucluelet (PO Box 999, Ucluelet, BC V0R 3A0). The Planning Department will review the application for zoning compliance, and the Finance Department will issue the license once all requirements are met. Processing typically takes 2-4 weeks.

Posting and Enforcement: Once approved, the business license must be prominently displayed in the STR. Failure to obtain or comply with a license can result in fines of up to $1,000 per day and potential legal action. The District actively monitors STR listings and investigates complaints.

It's important to note that a business license does not override the zoning bylaw or other municipal regulations. Hosts must comply with all rules related to occupancy, noise, parking, garbage disposal, and fire safety at all times.

For further questions about the licensing process, contact the District of Ucluelet at (250) 726-7744 or info@ucluelet.ca. The Ucluelet Hosting Community Facebook group at https://www.facebook.com/groups/ucluelethosts/ is also a helpful resource for local STR operators.

Required Documents for Ucluelet Short-Term Rentals

To apply for a short-term rental business license in Ucluelet, property owners must submit the following documents to the District:

1. Completed Business License Application Form: This form, available on the District's website or at the municipal office, collects basic information about the property owner, the rental property, and the proposed STR operation. It must be signed by all owners on title.
2. Proof of Ownership: A copy of the property's title certificate or a recent property tax notice demonstrating the applicant's ownership. If the owner is a corporation, a corporate search and proof of signing authority is required. This establishes the applicant's legal right to operate an STR on the property.
3. Strata Council Approval (if applicable): If the property is part of a strata, a letter from the strata council confirming that short-term rentals are permitted under the bylaws and approving the specific application. Many stratas prohibit or restrict STRs to maintain the residential character of the building.
4. Floor Plan: A detailed floor plan of the short-term rental unit, clearly showing the dimensions and uses of each room, the location of smoke and CO alarms, fire extinguishers, and emergency exits. This helps confirm the STR meets building code and safety requirements.
5. Parking Plan: A site plan of the property showing the location and dimensions of all parking spaces intended for STR guests. Ucluelet requires at least one off-street parking space per bedroom rented. This manages parking impacts on the neighborhood.
6. Fire Safety Plan: A written description of fire prevention and emergency evacuation measures, including procedures for notifying guests, locations of extinguishers and exits, and an evacuation floor plan to be posted in the rental unit. This is reviewed and approved by the Ucluelet Fire Department.
7. Guest Information Package: A summary of the "house rules" and key information to be provided to STR guests, including owner contact info, emergency numbers, noise and parking rules, garbage disposal instructions, etc. This communication helps guests understand their responsibilities and mitigates impacts on neighbors.
8. Responsible Person Consent Form: A signed declaration from a local contact person who will be available 24/7 to respond to any issues with the STR property or guests within 30 minutes. This ensures accountability and timely resolution of neighborhood concerns, even if the owner is not locally based.

These documents must be submitted with the initial business license application, along with the applicable fees ($165 for the first year, $140 annually thereafter). The District may request additional information or inspections as part of the review process.

Once issued, the business license must be prominently displayed in the STR and the license number included in all advertising. Failure to comply with STR regulations can result in fines, license revocation, and legal action.

For more information and application forms, visit the District of Ucluelet's website at https://ucluelet.ca/community/planning-building-bylaw/business-licensing or contact the Planning Department at 250-726-7744 or info@ucluelet.ca.

Ucluelet Short-Term Rental Taxes

Short-term rental operators in Ucluelet are subject to several taxes that must be collected from guests and remitted to the appropriate authorities. Understanding these tax obligations is crucial for running a compliant and successful rental business. Here is a breakdown of the key taxes that apply:

Provincial Sales Tax (PST)

The Province of British Columbia levies an 8% PST on the purchase price of short-term accommodations, unless a specific exemption applies. This tax applies to all rentals of less than 27 days in duration. As an operator, you are required to register to collect PST, charge it on the total price paid by guests (including cleaning fees, booking fees, etc.), and remit it to the province on a regular basis, typically quarterly.

Municipal and Regional District Tax (MRDT)

The MRDT is an additional tax of up to 3% that participating municipalities, regional districts, and eligible entities can apply to short-term accommodations. The tax is intended to fund local tourism marketing, programs, and projects. Ucluelet currently has a 2% MRDT in effect. Like the PST, this tax is collected by operators and remitted to the province, which then distributes the funds to the designated recipient.

So, in total, guests in Ucluelet can expect to pay a combined tax rate of 10% (8% PST + 2% MRDT) on their short-term rental stays. It's important for hosts to clearly communicate these taxes to guests and include them in the total price quoted.

Goods and Services Tax (GST)

The GST is a federal value-added tax that applies to most supplies of goods and services in Canada. Generally, short-term rentals are exempt from GST as long as the host is not operating as a GST-registered business. However, if your rental revenues exceed $30,000 per year, you may be required to register for and charge GST. The current GST rate is 5%.

Income Tax

As a short-term rental operator, the income you earn from your rentals is taxable and must be reported on your personal or corporate income tax return. The amount of tax you owe will depend on your total income and tax bracket. Be sure to keep accurate records of all your rental income and expenses throughout the year to make tax time easier.

Possible Deductions and Write-Offs

The good news is that many of the expenses involved in running a short-term rental are tax deductible. This can help offset some of your tax liability. Some common deductions for rental hosts include:

1. Mortgage interest
2. Strata/HOA fees
3. Property taxes
4. Utilities
5. Insurance
6. Repairs and maintenance
7. Cleaning and supplies
8. Advertising and platform fees
9. Professional fees (e.g. accountant, lawyer)
10. Depreciation on furnishings and equipment

You can deduct expenses incurred solely for the rental portion of your property. If you also use the property personally, you'll need to calculate the percentage used for rental and only claim that portion. Keeping detailed records and receipts is key to supporting your deductions in case of an audit.

It's always a good idea to consult with a qualified tax professional who understands the short-term rental industry to ensure you are optimizing your deductions and staying compliant with all tax laws. With proper planning and record-keeping, you can minimize your tax burden while providing a great experience for your guests.

British Columbia Wide Short-Term Rental Rules

While Ucluelet has its own specific short-term rental regulations, hosts in the community should also be aware of broader rules and laws that apply across the Vancouver area and British Columbia. These include:

1. Provincial Principal Residence Requirement: As of May 1, 2024, the Province of British Columbia implemented a new rule limiting short-term rentals to the host's principal residence, plus one additional unit on the same property, in many communities. However, this requirement does not automatically apply in Ucluelet due to its status as a resort municipality with a population under 10,000. The District of Ucluelet has the option to "opt-in" to the principal residence requirement in future years if desired.
2. Provincial Sales Tax (PST): Short-term accommodations in BC are subject to the 8% PST, which hosts must collect from guests and remit to the province. This applies to all rentals under 27 consecutive days, including those in Ucluelet. Hosts need to register to collect PST and file regular returns, typically on a quarterly basis.
3. Municipal and Regional District Tax (MRDT): Many communities in BC, including Ucluelet, have implemented an additional MRDT of up to 3% on short-term accommodations. Like the PST, this tax is collected by hosts and remitted to the province to fund local tourism marketing and projects. The current MRDT rate in Ucluelet is 2%.
4. Business Licenses: While specific licensing requirements vary by municipality, all short-term rental operators in BC must have a valid business license from their local government. In Ucluelet, hosts need to apply for a business license from the District, provide required documentation, and pay an annual fee based on the number of bedrooms rented. Failure to obtain or comply with a license can result in fines and legal action.
5. Strata Bylaws: For properties located in strata buildings or developments, hosts must also comply with any bylaws or rules set by their strata corporation regarding short-term rentals. Some stratas prohibit or restrict vacation rentals to maintain the residential character of the property. Hosts should carefully review their strata bylaws and obtain written permission before listing their unit.
6. Income Tax: Income earned from short-term rentals is taxable and must be reported on the host's income tax return. Hosts should keep detailed records of all rental income and expenses to properly calculate their tax liability and claim allowable deductions. It's advisable to consult with a tax professional to optimize tax compliance.

While not exhaustive, this overview highlights some of the key provincial and regional rules and considerations for short-term rental hosts in Ucluelet and the broader Vancouver area. By understanding and complying with these requirements, in addition to Ucluelet's specific regulations, hosts can operate their rentals legally and successfully.

As always, it's important to stay informed of any changes or updates to short-term rental laws at the local and provincial levels. Connecting with organizations like the Ucluelet Chamber of Commerce and the BC Lodging and Campgrounds Association can help hosts stay current and access valuable resources and support.

Does Ucluelet Strictly Enforce Short-Term Rental Rules?

Compared to larger cities in British Columbia, like Vancouver and Victoria, that have taken a hard line approach to cracking down on illegal short-term rentals, Ucluelet has historically had a more permissive attitude. The small coastal town's economy is heavily dependent on tourism, and short-term rentals play a significant role in accommodating the influx of visitors, especially during the busy summer months.

However, in recent years, Ucluelet has begun to tighten its regulations and step up enforcement in response to the rapid proliferation of short-term rentals and their impact on housing affordability and availability for long-term residents. The district has dedicated more resources to proactively monitoring listings and investigating complaints, with a full-time bylaw enforcement officer now on staff.

Scanning through discussions on forums like Bigger Pockets and local Facebook groups, the general consensus among hosts seems to be that while Ucluelet is not as stringent as some cities, the risk of operating an illegal short-term rental is increasing. Several hosts reported receiving warning letters or fines for operating without a proper business license or in a zone where STRs are not permitted.

One host on Bigger Pockets wrote, "We've been renting out our cabin in Ucluelet for years with no issues, but last summer, we got a notice from the bylaw officer saying we needed to get a business license or shut down. It was a wake up call that they are paying more attention now. We ended up getting the license, but it's definitely not the Wild West anymore."

Another host in a local Ucluelet Facebook group shared, "I know several people who have had to stop renting on Airbnb because they couldn't get a license under the new rules. It's getting harder to fly under the radar, and the fines are steep if you get caught. Not worth the risk in my opinion."

At the same time, there are undoubtedly still many STRs operating illegally in Ucluelet, either without a license or in violation of zoning requirements. With limited enforcement resources and the challenges of proving non-compliance, some hosts continue to skirt the rules. However, the overall trend appears to be towards greater compliance as the district ramps up its oversight.

Compared to Tofino, its neighboring tourism town, Ucluelet has taken a slightly more lenient approach to STRs. Tofino has opted into the province's new STR restrictions that require units to be in a host's primary residence, while Ucluelet has so far declined to adopt those rules. However, both communities are grappling with how to balance the economic benefits of tourism with the urgent need for long-term housing.

In conclusion, while Ucluelet may have been seen as an "Airbnb-friendly" town in the past, the regulatory landscape is shifting. The district is becoming more proactive about enforcing its STR bylaws and cracking down on illegal operators. Hosts who follow the rules and obtain proper licensing can still thrive, but those trying to skirt the system face increasing risks. As one host put it, "The days of the STR Wild West in Ucluelet are numbered. It's time to play by the rules or get out of the game."

How to Start a Short-Term Rental Business in Ucluelet

Starting a short-term rental business in Ucluelet can be a rewarding way to earn income from your property and share the beauty of the Pacific Rim with visitors. However, it's important to follow the proper steps to ensure your rental is legal, safe, and successful. Here's a step-by-step guide to getting started:

1. Research the regulations: Before investing time and money into setting up your rental, thoroughly review Ucluelet's short-term rental bylaws and zoning requirements. Determine if your property is eligible for STR use and what specific rules you'll need to follow. The district's planning department can provide guidance and answer any questions.
2. Obtain necessary licenses and permits: Apply for a business license from the District of Ucluelet, which is required for all STR operators. You'll need to provide information about your property, the type of rental you're offering, and your contact details. You may also need to obtain a tourist accommodation permit from the province.
3. Prepare your property: Ensure your rental unit is safe, clean, and well-maintained. Install smoke and carbon monoxide detectors, fire extinguishers, and emergency lighting. Provide comfortable furnishings, linens, and basic amenities for guests. Consider hiring a professional cleaner between bookings to ensure consistent quality.
4. Set up your listing: Choose a reputable booking platform like Airbnb or VRBO to list your rental. Create an accurate, compelling listing with high-quality photos, detailed descriptions, and clear house rules. Be transparent about your pricing, fees, and cancellation policies.
5. Implement a management system: Decide how you'll handle guest inquiries, bookings, check-ins, and maintenance. You can manage the rental yourself or hire a professional property manager to handle the day-to-day operations. Establish clear communication channels and response times to ensure a smooth experience for guests.
6. Comply with tax obligations: Register to collect and remit the 8% PST and 2% MRDT on all short-term rental bookings. Keep accurate records of your rental income and expenses, and report them on your annual income tax return. Consult with a tax professional to ensure you're claiming all eligible deductions.
7. Promote your listing: In addition to the exposure you'll get through your booking platform, consider additional marketing efforts to attract guests. Develop a website or social media presence showcasing your rental and its unique features. Partner with local businesses or tourism organizations to cross-promote your property.
8. Be a responsible host: Foster positive relationships with your neighbors by ensuring your guests follow noise, parking, and garbage rules. Be available to address any concerns or issues that arise during a guest's stay. Contribute to the local economy by recommending nearby businesses and attractions.

Starting a short-term rental business in Ucluelet requires careful planning, compliance with local regulations, and a commitment to providing exceptional guest experiences. By following these steps and continually adapting to the evolving market, you can build a successful and sustainable rental operation in this stunning coastal destination.

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

If you have questions or concerns about short-term rental regulations and zoning in Ucluelet, there are several key resources and contacts available:

District of Ucluelet Planning Department: The Planning Department is responsible for administering and enforcing the district's zoning bylaws and short-term rental regulations. They can provide information on permitted uses, licensing requirements, and the application process. Contact them by:

Phone: (250) 726-7744
Email: info@ucluelet.ca.
Address: 200 Main Street, Ucluelet, BC V0R 3A0

Ucluelet Chamber of Commerce: The Chamber of Commerce is a valuable resource for local businesses, including short-term rental operators. They can provide guidance on best practices, industry trends, and networking opportunities. Contact them by:

Phone: (250) 726-4641
Email: chamber@ucluelet.ca
Website: https://ucluelet.ca/community/chamber-of-commerce

Ucluelet Hosting Community Facebook Group: This private Facebook group is a platform for short-term rental hosts in Ucluelet to connect, share experiences, and support one another. It's a great place to ask questions, get recommendations, and stay up-to-date on local regulations and industry news. Join the group at:

https://www.facebook.com/groups/ucluelethosts/

BC Lodging and Campgrounds Association (BCLCA): The BCLCA is a provincial trade association representing the interests of short-term rental operators and other accommodation providers. They offer educational resources, advocacy support, and networking events. Contact them by:

Phone: (778) 383-1037
Email: info@bclca.com
Website: https://www.bclca.com/

Tourism Ucluelet: Tourism Ucluelet is the official destination marketing organization for the community. While they don't directly regulate short-term rentals, they can provide valuable insights into the local tourism industry and promotional opportunities for licensed operators. Contact them by:

Phone: (250) 726-4483
Email: info@tourismucluelet.com
Website: https://www.discoverucluelet.com/

In addition to these local resources, there are also several online forums and communities where short-term rental hosts across Canada connect and share information:

1. Airbnb Community Center - Canada Hosts Forum: https://community.withairbnb.com/t5/Country-Forums/Canada-Hosts/bd-p/CA
2. VRBO Community Forum - Canada: https://community.vrbo.com/t5/Canada/bd-p/CA
3. Bigger Pockets - Short-Term Rental Discussions: https://www.biggerpockets.com/forums/530-short-term-rental-discussions

By engaging with these local contacts and online communities, short-term rental hosts in Ucluelet can access the information, support, and resources they need to operate successfully and compliantly. Building positive relationships with local officials, industry partners, and fellow hosts is key to navigating the evolving regulatory landscape and thriving in the competitive world of vacation rentals.

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

Searching through discussions on popular online forums reveals a mix of opinions and experiences among short-term rental hosts in Ucluelet regarding the local regulations. Here are some notable examples:

Reddit - /r/AirBnB - "New STR Rules in Ucluelet, BC": In this thread from September 2022, a user posted about the recent changes to Ucluelet's short-term rental bylaws, including the new business licensing requirements and zoning restrictions. Several hosts chimed in with their thoughts and experiences.

One host commented, "I've been operating my STR in Ucluelet for 3 years now, and while the new rules are a bit of a hassle, I understand why they're necessary. The town is really struggling with housing affordability, and I think it's fair to ask STR operators to do their part. As long as the process is clear and consistent, I'm happy to comply."

Another host expressed frustration, saying, "I feel like these new rules are just a cash grab by the district. I'm already paying taxes and contributing to the local economy, and now I have to jump through all these hoops and pay even more fees just to keep operating. It's getting harder and harder to make a profit with all these regulations piling up."

Bigger Pockets - "Ucluelet STR Bylaws - Advice Needed": In this post from November 2021, a prospective host reached out for guidance on navigating Ucluelet's short-term rental regulations. They were considering purchasing a property to use as a vacation rental but wanted to ensure they could operate legally.

One respondent offered this advice: "I've been hosting in Ucluelet for a few years, and my biggest recommendation is to work closely with the planning department from the start. They can help you determine if a property is zoned for STRs and guide you through the licensing process. It's better to ask questions upfront than to invest in a property and find out later that you can't legally rent it out."

Another host shared their experience: "I had to go through a bit of a learning curve when I first started hosting in Ucluelet. I didn't realize I needed a business license and ended up getting a warning letter from the bylaw officer. But once I got everything sorted out and in compliance, it's been smooth sailing. The key is to stay informed and communicate with the district if you're unsure about anything."

Ucluelet Hosting Community - Facebook Group: This private Facebook group is a platform for short-term rental hosts in Ucluelet to connect and share information. Several recent posts have centered around the evolving regulatory landscape and how hosts are adapting.

In one post from October 2022, a host asked for clarification on the district's enforcement practices, saying, "I keep hearing rumors that bylaw officers are cracking down on unlicensed STRs, but I'm not sure what that actually looks like. Has anyone had any firsthand experience with enforcement? I want to make sure I'm doing everything by the book."

Another host replied, "I know of a few people who have received fines for operating without a license or in a zone where STRs aren't allowed. The district seems to be taking a more proactive approach to enforcement, so it's definitely not worth the risk of operating illegally. If you're not sure if you're in compliance, reach out to the planning department for guidance."

Overall, the sentiment among Ucluelet hosts on these forums seems to be a mix of acceptance and frustration with the local regulations. While many recognize the need for some oversight to balance the impacts of STRs on the community, others feel the rules are overly burdensome and costly. The key takeaway is the importance of staying informed, communicating with local officials, and prioritizing compliance to avoid legal and financial consequences. By working together and adapting to the changing landscape, Ucluelet's STR host community can continue to thrive while contributing positively to the town's economic and social fabric.

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.