Short-term rentals on PEI: licensing before revenue

The provincial licence

Under the Tourism Industry Act, accommodation offered to travellers for a continuous stay of less than one month is a tourism establishment, and that includes a cottage or cabin. It needs a licence before it operates or advertises, and the licence runs April 1 to March 31 and is applied for every year.

A booking-platform ad has to show the licence number.

The licence does not come with the property

The Act says a licence ends on the date the establishment is sold or leased. A buyer applies in their own name. A seller’s rental history tells you the property was licensed. It does not tell you that you will be.

• Ask whose name the current licence is in
• Make your own licence a condition, not an assumption

Municipal approval comes first

If the property is in a municipality with planning authority, Tourism PEI requires municipal approval before it will accept the licence application.

In Charlottetown, a short-term rental must operate from the host’s principal residence, and it needs a City short-term rental licence as well as the provincial one. The City also has a 3% Tourism Accommodation Levy on stays of 30 days or less.

Stratford’s zoning bylaw limits short-term rentals to owner-occupied homes, with a narrow duplex exception.

Ongoing rules

Licensed establishments are inspected every year. Where the drinking water comes from a private well, the operator has to test it for bacteria every three months, or part of three months, while guests are staying, at an accredited lab. Occupancy is reported to Tourism PEI monthly.

Tax side

Short-term accommodation is generally taxable for GST/HST. A small supplier, with taxable sales of $30,000 or less over four consecutive calendar quarters, generally does not have to register. Renting part of your home can also change the owner-occupied property tax credit. Ask an accountant how both apply to you.

What to put in the offer

A condition that the use is permitted where the property sits, and that you can get a licence in your own name. Ask for past bookings, not projections. Then run the numbers with the weeks you can defend. If the plan only works with a licence you cannot confirm, the plan does not work yet.

Sources

Checked October 2026. Rules change; confirm the current position before you rely on it.

• Tourism Industry Act, ss.1–2 (consolidation) (princeedwardisland.ca)
• Licensed Tourism Accommodations, Gov. of PEI (princeedwardisland.ca)
• Starting a Tourism Accommodation, Tourism PEI (tourismpei.com)
• Short Term Rentals & TAL FAQs, City of Charlottetown (charlottetown.ca)
• Stratford STR bylaw provisions (Dec 2025) (townofstratford.ca)
• When to register for GST/HST, CRA (canada.ca)
• GST/HST for travel and convention industry, CRA (canada.ca)
• Real Property Tax Act s.5.1 (princeedwardisland.ca)