Based in UK and started to have US tax withheld

[Amanda1552]

UK based host.
payments  this year have deductions for US tax.
No emails etc. about it.
 
Anyone else had this?

[Mike-And-Jane0]

@Michelle53 Interesting but only a US taxpayer has access to the tax numbers referred to. It is still not clear to me what happens to money withheld by Airbnb that has nothing to do with the US tax authorities.  I still believe a UK small claims court case would succeed in claiming this money back from Airbnb unless Airbnb could prove they have reasonable reasons to believe an individual is subject to US tax. 

[Michelle53]

@Mike-And-Jane0  The point I'm trying to clarify is that withholding is not Airbnb's money. 

The split second the withholding occurs, it becomes the "property" of the IRS.   They have no idea at the time the withholding occurs which jurisdiction it belongs to.  The only thing they know is that the taxpayer information has not been provided. Small claims court or otherwise, after the withholding occurs, it is no longer with Airbnb.

It basically gets held in a liability account to pay over to the IRS. Depending on the payment schedule they are on for withholding, it likely left the building already.   

For large amounts of tax, it's all automated and submitted electronically.

As far as what paperwork gets issued to folks caught up in all this,  all I know is that 1099-k reports are generated at year end for income of $600 or more.  Possibly this information will be online for people to review in the earnings report

[Mike-And-Jane0]

@Michelle53 I wasn't sure where the money was. I guess my point is that if Airbnb have withheld money improperly then a host could claim the amount involved from Airbnb. It would just add to their losses but never mind.

[Amanda1552]

I think same. I can’t help think this is a glitch. 

[Bianca477]

@Amanda1552  I am in Australia and this has just happened to me too.  No communication from Airbnb whatsoever that the form needed to be completed prior to me questioning them on why the withholding occurred.  Now I am awaiting on an answer as to how I can get a refund.  I have since completed the required form, but my concern is if the funds have already gone to the IRS how do we go about getting them back?!

[Michelle53]

@Bianca477  Contact a tax professional and ask about a Foreign Income Tax Offset. 

https://www.ato.gov.au/Forms/Guide-to-foreign-income-tax-offset-rules-2021/#:~:text=Overview,provide....

[Bianca477]

@Michelle53 I am a tax professional in Australia.  The only way to get this back through our tax system is to wait more than 6 months before we can lodge an income tax return.  Given the substantial amount of some of the withholdings this is unacceptable.  The fact that we were not correctly communicated with prior to them taking the withholding amount is extremely poor on Airbnb's part.  This money should be in our accounts now.

[Amanda1552]

Yes and I’m sure they need a reason for the trigger or else it’s just random and arbitrary. 

[Michelle53]

@Bianca477   In all my years in the US, I've never seen a direct refund issued by a company for a backup tax withholding, erroneous or otherwise.

However, if Airbnb comes back with a different response, based on the number of people affected, please do post here, as I think the word of a tax professional in a country affected by this will carry weight.

[Nicolas-and-Maria0]

Hello Bianca,

Something very similar is happening to us here in Lisbon, Portugal where we live and declare taxes and have 2 listings. "Out of the blue" we pay now taxes in the US: we have apparently already paid several hundred € to the US tax authorities and will pay taxes here in Portugal too (since it's here we declare and pay taxes).

The fact that we submit airbnb every year a withholding tax form (RFI-21) doesn't make a difference since we are now double tax payers and pay around 53% in taxes  (US and Portugal combined).

We really don't know what to do. We can fill in that form (W8BEN) airbnb wants us to submit without knowing why and on what grounds and without any rational explanation from airbnb.

Could you give us some input? Many thanks!

Nicolas & Maria Carlos

[Amanda1552]

I have no idea as we don’t have any of the tax numbers etc to claim. 
I’m still waiting to hear back to. 
I suspect some sort of glitch and a few of us have messaged. 

[Martin4236]

Hello Amanda,

Has this ever been resolved?

I have the same issue. 

Thanks,

Martin

[Nicolas-and-Maria0]

Same happening to me. Have absolutely no ties to the US and both my listings are in Lisbon, Portugal where I declare and pay taxes. On top of that, every year I fill in and send a withholding tax form to airbnb (here in Portugal it is form RFI 21) to avoid this type of issue.

I really don't know if I should fill in this W8BEN form. Your input is more than welcome. Thank you!

[Stephanie]

Hiya @Amanda1552 and everyone else,

Thank you for sharing your experience here in the Community Center and so sorry that this happened. I’m happy to report that after discussing this bug internally, the issue is fixed for future reservations and we are working on sorting out past reservations, like the one you have shared, as soon as possible.

We appreciate your ongoing patience on this.

Thanks, 

Stephanie

Extra tags @Nicolas-and-Maria0 @Michelle53 @Bianca477 @Mike-And-Jane0 

[Nicolas-and-Maria0]

Hi Stephanie,

Thank you for the good news !

We have already received 2 (out of 5) reimbursements this morning (30% withholding tax paid in the US due to this "bug").

Cheers,

Nicolas