UTILITIES CHARGE FOR TAX PURPOSES

[Josh-And-Tolu0]

We are relatively new hosts on Airbnb and have a room we use for Airbnb in our home.

We are pretty conservative with water and heat use in the winter but then with a guest, all of that changes.

For example, some guests take showers like they are fishes swimming (use so much water). We once had a guest who took a shower twice a day and washed her hair each time for the duration of her stay and used the hand dryer for at least 30 minutes each time. So that drives up the water bill.

We can use a space heater in our bedroom and brave a much lower temperature in the house and confine ourselves to a room, but with a guest, we use the central heat and turn it up to make them comfortable and a result cost of heat has tripled to quadrupled.

My question is how do we make a differentiation for these utility-related bills for tax purposes? How can we differentiate between what our Airbnb guests cost us vs what we used and get a deductible for that? Especially the cost of electricity in the winter seems like a lot. Thank you so much.

[Cormac0]

@Josh-And-Tolu0 

Take meter reading before your guests arrive and after they leave, that's what I used to do, and this led to some interesting findings.

1. Women used considerably more utilities then men

2. Eastern Europeans are much more frugal than their Western European equivalents 

3. Two adults and a baby use much more utilities particularly gas and water than three adults and this should come as no surprise to parents, It completely goes over the head of Airbnb which does not surprise me in the least. (Airbnb does not want us to charge for infants)

BTW water readings are a good indication of the number of guests staying. 

Don't forget to monitor temperature as well, I had one guest that on arrival the temperature was 20c and on her departure three days later it was 28c and she was still cold not much money made on that guest.

I record electricity, gas and water meter readings on a monthly basis for my long term letting as well.

If you feel so inclined, you should discuss with your tax authorities the way to proceed with the allocation of expenses for tax purposes as they’ve seen this all before.

What gets measured gets managed...

[Josh-And-Tolu0]

Thank you @Cormac0 , I don't think I can take those readings here in the US. I will inquire.