This forum is dedicated to connecting hosts with other hosts. Sign up to get the latest updates and news just for AirBnb hosts! Note that we are not affiliated with Airbnb - we are just passionate hosts!
I have to collect 10% tax from the guests and remit to county, I also have to get a copy of guests ID. Currently I wait for the 48 hour cancellation window to pass (strict policy) and then I send a message like this:
Thanks for booking River Rock Retreat we are looking forward to hosting you this Saturday. As stated in the house rules I will need a copy of your ID and 10% tax prior to check in. Currently Airbnb does not have a way to add this to your total when you book, I wish they did. You can upload a picture of your ID here or text to xxxxx and I will send you a request for money for the tax, $27.50 (or whatever it is)
Thanks again and we will see you Saturday.
Well this works, because I will not give the code until the tax is paid but some guests feel strong armed I think, last weekends guest responded to that message, I have a reservation number… This is as she stood at the door waiting for the code. I really hate having to prompt/remind guests to pay the tax!
Just now I saw an option, under change reservation to change the price, has anyone used this feature? If I change the price to include tax how does it work? Does the guest have an opportunity to cancel? As I do it now if a guest cancelled I think I would have a good case to get paid. I do not want to give them a option to cancel because they do not want to pay the tax, which is in the rules.
That’s what I am doing, but like I said I have to chase them for it and guests feel strong armed when they realize they cannot get door code until its paid. Maybe it is the only solution. Hopefully someone who has used, change reservation, change price can chime in as well.
Ive used change res… but i think that would also affect the overall fee and taxes that air collects on their end. Hopefully this is something that Air will work on because they really should be the ones taking of taxes etc
Yes, I’ve used it for collecting the pet fee. It does increase their overall price though due to Airbnb fees. If someone contacts you first instead of IB you can also tell them then that you’ll send a special offer that includes the tax. Special offer and change reservation both work the same way, the guest has to accept it.
AirBnB collects and submits the tax where I live, so this could prove very confusing for guests. Also, I’ve been advised on this portal time and again, guests do not read your listing. I mean who really reads all the t&c’s on a software program? So I can certainly see guests being upset at you asking for more money after they book. And waiting until the 48 hour cancel window passes, that is just bad. You are not being up front by waiting, you are strong arming users. Why not send the request right away? That way if the 10% makes the difference, they can cancel.
Maybe do the opposite, include the tax in your price, and state that in your listing.
You need to weigh the pros and cons, and make decision best for you. Obviously you are experiencing some of the cons (upset guest at your door). I would imagine for some it may hurt your ratings. And I feel this is a long game. I’ve noticed in my area, and my price range, the occupancy rate for someone with 4.5 starts is significantly lower than someone with 5 stars. While the benefit is fewer customer cancels, I think long term you may have lower revenue as you will have upset customers. When I say bad, I meant I think it will negatively affect your revenue long term. I apologize if what I was thinking in my head, did not come out right.
So I just finished up with today’s guest. First I sent the text and request for money she said sounds good, then asked for early check in. I told her the charge for early check in and she agreed, cancelled money request and sent another. Then she said it did not work! I texted her for her email and sent her a Stripe invoice and she promptly paid. I think I will go this route going forward and leave Air and their “systems” out of it, other than getting an acknowledgment on the app that they agree to the charges in case I ever have to argue over a bad review.
This guest has 7 reviews and has never reviewed a host. I would be worried if I got a notice she reviewed me! lol, she was gracious and I expect no issues. I just joined a wine club and left a bottle in the fridge she should be happy:)
If including tax in the price, RR could report the income net of the tax on US federal tax filing, or, if making enough to get a 1099 from Air that didn’t match, a workaround of reporting the gross as income and “expensing” the local tax. Here are the turbo tax software instructions on how to do that – when merchants get 1099-Ks with sales tax in the gross. https://ttlc.intuit.com/questions/2974350-my-business-1099k-includes-sales-tax-i-collected-paid-quarterly-to-my-state-how-do-i-deduct-that
You are correct that Air would take a cut on the tax amount. 3% of 10% tax on a $600 charge is $1.80, so could raise the price a few dollars to compensate. That’s how I manage it. I have business travelers that would probably not like to deal with after the fact extra tax payments, they expect to pay all at once, like at a hotel.
If it were me, I would just increase my prices by 13% (to include Air’s cut) and make it very plain up front that the price is “tax included”. Paying after-the-fact taxes would be a real turn off for us.
Even though I live downstairs, I have auto check in with combo locks so it’s often hard to catch guests in the summer because I work long hours then. Collecting the tax in cash or on my Square was always a problem (and dinged my stars at least once). For this summer I also raised the rates even though the city says I need to bill the 12% tax separately. Other Air hosts here just eat the tax, but they are all folks who don’t depend on Air rentals to pay their mortgage. I’m hoping that the 12-14% higher room rates don’t depress bookings for the summer.
I know, this really sucks, and only a fraction of the hosts in my area even pay the TOT tax, mostly the ones that got caught. Air is doing us a disservice not allowing us to add the tax like all the other big booking sites I use.
bookingdotcom, vrbo, tripadvisor all allow tax to be added.
Agree with @KenH , the right thing to do for both you and your guests is to raise your rate to the exact amount that covers the tax and put’s the desired/required cut in your pocket.
Correct me if I’m wrong, but what you are saying is that you’re annoyed that Airbnb doesn’t collect the local tax for you (which would show the guest the actual price they have to pay), but at the same time you think that raising your price to cover the tax would cause less guests to book (i.e. you are benefiting from the fact that guests see a lower rate on Airbnb than what they actually pay). There is a bit of irony here.
FYI, you would raise your rates by about 10.3%, not 13%. You are already paying the 3% service fee on your current rate, you just need to pay the 3% host service fee on the the 10% that goes to tax, so you need to raise your rates by 10.3%. The guest would see something around 11.8%, though, due to Airbnb’s guest fees.
If you think this would hurt your bookings, then you best be prepared for when Airbnb does start collecting the tax since I doubt that there would be much difference to the guest between 10% (if Airbnb collects it) and 11.8% (if you collect it with Airbnb’s’ fees),
