So in Virginia, now, they are requiring Airbnb to collect and remit state taxes of 4.6%. Fine, great. I don’t have to do it.
But my local municipality also collects a 5% tax.
I called Airbnb to find out how I can add a line item for this tax and it seems that I can’t. They said I either have to send an additional invoice - after the guest has already booked - and paid because I have instant booking - or I have to collect cash when they arrive.
Neither of these options are optimal. Why can’t I simply add another line item, like I charge $25 for each additional person after 4.
It makes no sense…
What do you do to collect local taxes?
Don’t you have, under Listings, Local Taxes and Laws?
I can add a tax that shows up as an additional charge.
Yes, it says Virginia State Tax, but there is no additional empty line for me to add one for my local taxes. Apparently if they collect NO tax, you can put whatever you want there, but if they collect some, you can’t do anything.
I called them and they said I have to collect cash or send an additional invoice, but that makes instant booking useless. Why would anyone want to make another payment?
Airbnb wants hosts to eat it…raise your fees to include it. But of course then Airbnb gets to collect their service fees on taxes which is also not fair.
Oh, so that’s why they aren’t in any hurry to fix it either.
I’m in VA too. It’s so annoying we can’t add a line for local tax, I concur!
I’ve previously collected both types of tax (state and local) by saying in my listing that my nightly fee is inclusive of taxes, then using a math formula to calculate the lower base charge in order to file and pay the taxes. (Sadly, I do not make enough to get an Airbnb 1099, so I don’t have to explain the mismatch that would create.)
If I continue to do this with the remaining local lodging tax, Airbnb is state-taxing the local tax, so to speak, and I’m paying a bit extra (grrrr).
I also have IB, self-entry, lots of short stay and business travelers, so I am not going to hit them up for a tax collection after the fact.
And I’m not going to lower my current all-tax inclusive rate; I think guests are less price-sensitive to add-on charges, such as the Air VA tax, than they are to the base rate.
I suspect a lot of hosts were not remitting taxes at all, so the agreement with Air to collect will increase VA tax revenues.
I collect local and state taxes , in cash, when guests arrive. It wasn’t set up in Georgia to do it so we make it clear in our listing and I also have a canned message I send right after a booking (we have instant book) reminding them of a couple of key things, including that point. And then a couple of days before arrival, I send them a message with some cool things to do and give them the exact amount needed, and let them know we can make change.
We’ve been doing it with no problem. Air just turned it on for Georgia, but like y’all, no option to show both lines…just one and so at this point I’m thinking I will just ignore that option, especially if they are going to add it to the calculation of the service fee.
I increased my cleaning fee by $5, which will pay for one night. Most of my stays are weekends, so that will help, but still.
It would be so simple just to add a blank line for whatever someone wants to charge, whether it be a pet fee or taxes or whatever. I don’t understand why they are making it so complicated.
Yes, such a pet peeve. Even if the Airbnb programmers can’t handle the math of booking fee times a percentage as a line item, I’ll calculate it!
I used to collect it in cash but since I switched to self check in I started collecting the tax through the resolution centre. I added a rule that guests are liable to pay the tax before their check-in day. I send the guests a receipt for the tax they paid on their check-in day. So far no problems.
Do you charge a cleaning fee? If not, start charging a fee and use it to pay the taxes or just increase the nightly rate to include taxes. I think that would be the best option.
Not smart to call it a cleaning fee and use it for taxes, IMO.
I am also in VA, and today I finally got some clarification from Airbnb as to what tax they were collecting. It turns out that they only collect the VA sales tax but not the local transient tax, so that leaves us with this responsibility the local transient tax. Airbnb should make it clear that they are collecting the VA Sales tax and not the local transient tax which is another 5%. In the past I did not have any issues collecting both taxes which came to 10.3%. I stated in my description that I had to do this, and the guests did not have any problems. Since I don’t always see the guests when they check in, I got in the habit of leaving an envelope with the amount and asked them to put it in the box outside the front door of the cottage. For the most part the guests have been honest and did it. I have only had a couple of them who did not so I did contacted them to get the tax.
Now things are complicated I have changed my description explaining that Airbnb only collects the VA sales tax and that I have to collect the other 5%. Tomorrow will be the first time that this happens, we will see.
I think that in the pricing page, Airbnb should have a line for local transient tax . Since this varies from place to place it could be stated as a percentage, the guests would pay it and we the hosts would send it to the local administration. That way the quest who have not read your description would not be surprised to have to pay upon arrival. As it is now they don’t recognize that they have only paid the state tax and question why there is a transient tax on top of that.
That sounds good, but then it becomes income and we are taxes on it.
Grrrr, I’m in VA also, and it doesn’t help that Airbnb refers to the state sales tax they are collecting as “lodging tax.” I continue to fully disclose the the 7.25% local transient occupancy tax as included in the price. So what I have doing since before this “service” from Air started is to back out the base rate so my total charge equals base rate + tax. Of course Airbnb adds the 6% state sales tax on top of everything, so my formula no longer works. I’d actually prefer to handle both sets of taxes myself because Air is only doing a half job of it. Why can’t they allow me to add a percentage tax as well as a cleaning fee? It can’t be that ridiculously hard to program. Maybe I’ll suggest to my county to have Air collect for them, I bet it would increase their revenue. Based on the number of Airbnb permits my county has issued vs. the number of listings, the majority are non-reporting.
That’s true of all taxes that Americans are required to “self-report.”
Hello, I am wondering which county you are in? I recently opened an Air bnb in Fairfax county and am not sure how to pay the transient tax. Any guidance on this would be appreciated.
Kush - this forum is invaluable for learning about just about every aspect of hosting. But when it comes to legal issues, you’re much better advised to contact your local authority, your business attorney or your accountant.
Much as we’d love to advise you, we can’t as we’re from all over the world and in different circumstances. Strangers on a forum can’t take the place of local experts.
Fairfax County, VA? I have friends there who consulted with me about doing Airbnb in their home, so I know a little bit. See https://www.fairfaxcounty.gov/planning-development/zoning/short-term-property-rentals for all the details.
I think it would be difficult to make money in Fairfax; the county requires a $200 2-year fee, and limits short term rentals to 60 nights per year. The permit form is downloadable but must be mailed in or submitted in person. Transient occupancy tax is 6%. Airbnb adds and remits an additional 6% Virginia state sales tax.