Table Of Contents
Last Updated on March 12, 2025 by Fullhome Airbnb Manager
This blog post will serve as a comprehensive guide for property owners in the Blue Mountains who operate short-term rentals (STRs), helping them navigate local rules, permits, taxes, and guest restrictions.
The Town of Blue Mountains, Ontario, is a sought-after destination for short-term rentals, attracting visitors year-round with its ski resorts, hiking trails, and waterfront retreats. With the growing popularity of Airbnb, Vrbo, and other vacation rental platforms, the town has implemented strict regulations to ensure STRs operate responsibly and do not negatively impact local communities.
If you own a short-term rental in Blue Mountains, you need to comply with local licensing requirements, occupancy limits, tax obligations, and zoning bylaws. Failure to follow these rules could result in hefty fines or permit revocation.
This guide outlines everything you need to know about STR regulations in Blue Mountains, Ontario—including permit application steps, compliance tips, and how to stay updated with local rules.
Short-Term Rental Bylaws & Permit Requirements in Blue Mountains, Ontario
The Town of Blue Mountains (TBM) enforces strict short-term rental (STR) regulations to ensure properties operate safely and do not disturb permanent residents. If you plan to rent your property on Airbnb, Vrbo, or similar platforms, you must obtain the proper permits and follow local bylaws.
1. STR Licensing Requirements
- All short-term rentals in Blue Mountains require a license from the town.
- The license must be renewed annually, and non-compliance can result in fines.
- Only properties in approved zones (such as certain residential and commercial areas) are eligible for STR licensing.
- Multi-unit buildings and condominiums may have additional restrictions from condo boards or homeowner associations (HOAs).
2. Occupancy Limits & Guest Restrictions
- The town enforces strict occupancy limits based on property size and zoning.
- In most cases, the maximum occupancy is two guests per bedroom, up to a total of eight guests per rental.
- Additional rules may apply for noise control, parking, and waste management to prevent disturbances in residential areas.
3. Safety & Compliance Standards
To qualify for an STR license, your property must meet fire and safety regulations, including:
- Smoke and carbon monoxide detectors in each bedroom and common area.
- A fire extinguisher and emergency exit plan displayed inside the rental.
- Proof of liability insurance covering short-term rental operations.
Failure to comply with these regulations can lead to license suspension, fines, or even permanent revocation of STR privileges.
Tax Considerations for Blue Mountains, Ontario Airbnb Hosts
If you operate a short-term rental (STR) in Blue Mountains, Ontario, you must comply with municipal, provincial, and federal tax obligations. Understanding these tax requirements ensures you avoid penalties and stay financially compliant.
1. Municipal Accommodation Tax (MAT)
- The Town of Blue Mountains charges a 4% Municipal Accommodation Tax (MAT) on all short-term rental stays.
- This tax applies to bookings of 30 days or less and must be collected from guests at the time of booking.
- Hosts are responsible for remitting the MAT to the town on a quarterly basis.
- Some booking platforms (e.g., Airbnb, Vrbo) may automatically collect and remit the MAT, but hosts should confirm with the town to ensure compliance.
2. HST/GST Obligations
- If your STR generates more than $30,000 per year, you must register for a Goods and Services Tax/Harmonized Sales Tax (GST/HST) number and charge 13% HST on rental income.
- Hosts must file HST returns regularly and remit taxes to the Canada Revenue Agency (CRA).
- If you earn less than $30,000 per year, GST/HST registration is optional, but you won’t be able to claim input tax credits on expenses.
3. Income Tax Reporting
- All STR income must be reported to the Canada Revenue Agency (CRA) as rental income.
- Eligible deductions may include:
- Mortgage interest (if applicable to rental space)
- Utilities (electricity, water, gas, internet)
- Cleaning and maintenance costs
- Insurance premiums
- Property management fees
- Failure to report STR income can result in penalties and audits from the CRA.
Guest Limits and Noise Regulations in Blue Mountains, Ontario
The Town of Blue Mountains enforces strict guest limits and noise regulations to maintain community peace and ensure STRs operate responsibly. Non-compliance can lead to fines, license suspension, or legal action.
1. Occupancy Limits
- The maximum number of guests allowed is typically two guests per bedroom, with a total limit of eight guests per rental unit.
- Overcrowding violations can result in fines or loss of STR licensing.
- Some properties in certain zones may have additional occupancy restrictions based on zoning laws.
2. Noise & Nuisance Restrictions
- The Town of Blue Mountains has a strict noise bylaw prohibiting excessive noise between 11:00 PM and 7:00 AM.
- STR hosts must ensure guests comply with quiet hours, especially in residential neighborhoods.
- Complaints from neighbors can lead to bylaw enforcement actions and fines, and repeated offenses may result in license revocation.
3. Parking & Waste Disposal Rules
- STRs must comply with local parking regulations, including limits on the number of vehicles allowed per rental.
- Improper waste disposal (e.g., leaving garbage outside on non-collection days) can result in penalties.
- Hosts should provide clear instructions to guests on proper garbage and recycling procedures.
Violating guest limits, noise regulations, or waste management rules can jeopardize your STR license and lead to enforcement actions from the town.
Staying Updated on Local Regulations
Short-term rental regulations in Blue Mountains, Ontario, can change over time, and staying informed is crucial to maintaining compliance. Hosts should proactively monitor local bylaws, tax updates, and zoning changes to avoid unexpected penalties.
1. Follow the Town of Blue Mountains Website & Bylaw Updates
- The Town of Blue Mountains’ official website (www.thebluemountains.ca) provides updates on STR licensing, zoning changes, and enforcement actions.
- Reviewing council meeting minutes can help hosts stay informed about proposed bylaw amendments.
2. Join Local Host Communities & Industry Groups
- Participating in Ontario STR host forums, Facebook groups, or Airbnb community meetups can provide insights on best practices and regulatory changes.
- Networking with other hosts can help navigate complex STR policies and share compliance tips.
3. Work with an Experienced STR Management Company
- STR property management services can handle licensing, tax compliance, and guest screening, ensuring hosts follow all local regulations.
- Professional managers stay updated on bylaw changes and help prevent compliance issues before they arise.
Failing to stay informed about rule changes can result in unexpected fines, license revocation, or even a ban on short-term rentals in certain zones. Keeping up to date ensures a smoother, legally compliant rental operation.
Conclusion & Call to Action
Operating a short-term rental in Blue Mountains, Ontario, comes with important legal responsibilities. Hosts must obtain the proper licenses, comply with guest limits, pay required taxes, and follow noise and safety regulations to avoid fines or penalties. With the Town of Blue Mountains actively enforcing STR bylaws, staying informed is essential for running a successful and compliant rental business.
To simplify compliance, consider working with a professional short-term rental management service. A management team can handle licensing, tax reporting, guest screening, and property maintenance, ensuring your Airbnb operates smoothly while staying within local laws.
👉 Need help managing your Blue Mountains Airbnb? Contact [Full Home’s Management Team] for expert support in navigating local regulations and maximizing your rental income.
Resources – Short-Term Rental Bylaws & Permits in Blue Mountains, Ontario
Government Websites (Official Regulations)
- Town of The Blue Mountains – Short Term Accommodations –
Legal Sources (Laws and Explanations)
- SV Law Blog – “Homeowner Convicted for Renting on Airbnb” – Notably, the Ontario Municipal Board and courts upheld the town’s right to enforce these rules
- OPPI Planning Exchange – “Regulating Short-Term Accommodations” – An analysis by Ontario planners (Jan 2024) explains how The Blue Mountains’ planning and zoning framework manages short-term rentals – ontarioplanners.ca. Rather than broadly legalizing STAs, the town prohibits them in all low-density residential zones and confines them to a special “Resort Residential (RR)” zone near the Blue Mountain resort. The piece notes that the town’s 2009 Official Plan and zoning amendments (defining and segregating STAs) were appealed, but in 2011 the OMB upheld Blue Mountains’ approach, recognizing STAs as commercial uses incompatible with quiet residential neighborhoods. This provides a regulatory context for the town’s licensing bylaw.
Industry Insights (Airbnb/Hosting Guidance)
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guestable.com Guestable – Blue Mountains Short-Term Rental Guidelines – The article highlights the need to check if a property is in a zone that allows STAs, fulfill all zoning by-law provisions (parking, occupancy limits, distance requirements), and then complete the town’s licensing process. It’s essentially a how-to for operating legally, translating the bylaws into practical steps for owners (from obtaining a planning clearance to submitting license applications and understanding fees and fines).
- Property Valet – “STA By-Laws in Collingwood & The Blue Mountains” – A local property management company’s blog post (Nov 15, 2020) outlines the permit requirements and costs for short-term rentals in The Blue Mountains. It warns that before renting for under 30 days, you must apply for a license. The initial STA license costs $2,000 with a $750 bi-annual renewal
Local News & Community Perspectives
- CollingwoodToday – Council Tightens Rental Rules – The Blue Mountains council voting to ban new short-term rentals outside the designated “exception area.” Once approved by Grey County, the Official Plan amendment will eliminate STAs in all parts of town except those zones specifically allowed (primarily the resort and Resort Residential areas around Blue Mountain Village)
- CollingwoodToday – Crackdown on Illegal STAs – This July 10, 2024 report covers a packed public meeting in Blue Mountains about tougher STA bylaws and steeper fines. Town officials, citing public complaints, proposed major updates: replacing the appeals committee with a hearing officer, adding new license categories, and dramatically increasing penalties for violations
Real Estate & Tourism-Related Insights
- Cottage Life – “Are short-term rental bylaws working?” – It cites The Blue Mountains, Ontario as an example where zoning restrictions forbid short-term rentals in most residential areas. In Blue Mountains (like in Canmore, Alberta), rentals are only permitted in commercial or resort-designated districts
- Greg Syrota Real Estate Team – Rental Bylaw Overview – A local realtor team provides a summary of rental regulations by municipality in the Georgian Bay area, including The Blue Mountains. They note Blue Mountains was “one of the first” towns to regulate short-term rentals due to years of noise and party complaints. The result is a “complex licensing program” for STAs – anyone using platforms like Airbnb/VRBO in Blue Mountains must obtain a license under the town’s system