If the rental income generated is only incidental and the property remains your place of residence, you must report the rental income and expenses on your personal tax return. Although you may claim capital cost allowance on the portion of your home being rented out, this will reduce your ability to claim the principal residence exemption and shelter any gain from the eventual sale of your home.
If you jointly own the house with a lower income spouse or common-law partner, consider splitting the rental income with them. Rental income is considered earned income for the determination of RRSP contribution room. Allocating a portion of the rental income to your spouse or common-law partner allows them to earn RRSP contribution room.
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