Does Airbnb Collect Occupancy Tax for Hosts?

An occupancy tax is a charge applied to the rental of short-term lodging, also known as a transient occupancy tax, hotel tax, or tourist tax. State and local governments levy these taxes on accommodations like hotels, motels, and vacation rentals. The revenue often funds tourism promotion, convention centers, or other public services. While the tax is paid by the guest, the responsibility for collecting and remitting it falls on the property owner.

Airbnb’s Role in Tax Collection

Airbnb’s involvement in handling occupancy taxes varies significantly by location. In many jurisdictions, the platform has entered into agreements with government agencies to automatically calculate, collect, and remit these taxes on behalf of hosts. This “default collection” means that for any booking made through the platform, Airbnb adds the appropriate tax to the guest’s bill and sends the funds directly to the correct tax authority. Hosts in these areas do not need to handle the remittance of these specific taxes themselves.

In other locations, Airbnb may use a “pass-through” model, collecting the tax from the guest and passing it to the host in their payout. The host receives the tax funds and is then personally responsible for filing returns and remitting the money to tax authorities. Hosts must understand which system applies to them.

To determine how taxes are handled for your listing, navigate to your hosting account settings to review the tax collection features. The platform provides a list of jurisdictions where it handles automatic collection and remittance. If your area is not on this list, or if the agreement only covers certain taxes, such as state but not city, you are responsible for any remaining tax obligations.

Even when Airbnb remits taxes directly, some jurisdictions may still require hosts to file a tax return. This return might show zero tax due, but it serves as a declaration to the tax authority that the obligations for that period were handled by the platform. Failure to file these informational returns can result in penalties, so confirm filing requirements directly with your local tax agency.

Determining Your Local Tax Obligations

If Airbnb does not manage tax remittance in your area, you must identify all applicable tax obligations. Short-term rentals can be subject to taxes at multiple levels of government, including city, county, and state, each with its own tax rate and rules.

Start your research using online search terms like “[Your City Name] transient occupancy tax” or “[Your County Name] short-term rental tax.” This will lead you to the official websites of local government finance departments. These sites provide information on tax rates, registration requirements, and filing procedures.

Before you can legally collect taxes from guests, you must register with each relevant tax authority. This process involves completing an application to obtain a tax permit or license. The application will require basic information about your business and the rental property address.

Once registered, you will receive a tax account or permit number. This number must be used on all future correspondence and tax filings with that agency. Keep a record of each registration number for each jurisdiction, as you will need them when you file your returns.

Managing Manual Tax Collection and Remittance

The first step in manual collection is to accurately calculate the tax for each booking. This is done by multiplying the booking’s taxable amount, which often includes the listing price plus any cleaning fees, by the applicable tax rate. If you are subject to multiple taxes, such as a 6% state tax and a 2% city tax, you must calculate and account for each one separately.

In some locations, Airbnb allows hosts to use a feature to add custom taxes directly to a listing. This tool automatically adds the specified tax to the guest’s bill at booking. Airbnb collects the tax and then passes it through to the host in their payout, and the host is then responsible for remitting it to the authorities.

If the custom tax feature is not available, you can use the Resolution Center to request the tax payment from the guest after they book. In cases where you must collect taxes manually, you should clearly state in your listing description that required taxes will be collected separately.

After collecting the taxes, you must remit them to the appropriate government agencies according to their required schedule, which is often monthly or quarterly. You will need to complete a tax return form for each jurisdiction, reporting your gross rental receipts and the amount of tax due. Payments are made at the time of filing, and most agencies now offer online portals for electronic submission. Meeting all filing deadlines is important, as late submissions can result in penalties and interest charges.