Hello
Hope everyone is well. I am Tay Boon Long. I am curre...
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Hello
Hope everyone is well. I am Tay Boon Long. I am currently in the midst of completing my final year research for my MBA...
Latest reply
Has anyone figured out how Air BNB collects and remits state and county taxes? I'm getting one lump sum and can't figure out how much is going to state and how much is going to county. The state is 6% and county 3%, but air bnb is collecting 9.8%. I can't figure out where the other 8% is going or prove to the county/state that they have been paid. Is it easier to just to custom tax and pay them myself?
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Hi @Devon172
This is a bit complicated, but I believe this could be your answer? Maybe another Host in Carbon County, PA can verify...
Occupancy Taxes are usually paid only on the nightly rate plus any fees (excluding the Airbnb Svc Fee). Looks like State of Pennsylvania charges both the Host (operator) AND Airbnb (booking agent) a 6% fee. Carbon County charges 3% HOT.
I think this is how they are calculating it. You can review the State’s explanation of how they charge the 6% HOT on both you as Host on the nightly rate and cleaning fee AND 6% charge to Airbnb on the Guest Service Fee only. This is a bit unusual. Most states only charge the Host the HOT. If the state applies sales tax, it would apply to nightly rate, fees and Airbnb Guest Service Fee. You’ll have to read thru the info in the link below and then confirm this with Airbnb to be sure:
https://www.revenue.pa.gov/TaxTypes/SUT/Pages/Hotel-Occupancy-Tax-Booking-Agents.aspx
Sample Transaction
A customer books a hotel room for one night through a booking agent for a discounted room charge of $100.00. The booking agent charges a $20.00 accommodation fee for providing the service. The booking agent bills the customer as follows:
Discount Room Charge | $100.00 |
Accommodation Fee | +$20.00 |
Total Rent Charge | $120.00 |
6% PA Hotel Occupancy Tax | + $7.20 |
Total Amount Due | $127.20 |
Example Reservation
Nightly Rate + Fees (cleaning fee) = $639.20
$639.20 x 9% (combined state/county HOT) = $57.528 round up $57.53
Airbnb Svc Fee $90.24 x 6% = $5.41
$5.41 + $57.528=$62.94
Hi @Devon172
I can only see a total of 9% on Airbnb for your location (State 6% and Carbon County 3%) as well?
Please let us know here what your listing shows as to what tax jurisdictions are listed as collected by Airbnb.
It should be 9% (6% for PA and 3% for Carbon county) total but when I calculate it, it is 9.8%. That is my confusion. I am using the amount on the earnings report after the service fee. (Its even more if I use the amount before the service fee but I don't think that is included.) The numbers don't work. For example, in May, I had one rental and the amount of the payout after service fee was deducted was $479.57. 9% of that is $43.16 but they collected $48.68. Where is the rest going?
Hi @Devon172
Can you post a screen shot of the tax section on your listing so I can see what it shows?
sorry I was away yesterday but after reading your messages I did the calculations adding in the tax on the air bnb guest service fee and the numbers match up. Thank you for your response. No one else has been able to explain this. Now I can do my sales/occupancy taxes knowing the correct amounts. THANK YOU again!!
Hi @Devon172
This is a bit complicated, but I believe this could be your answer? Maybe another Host in Carbon County, PA can verify...
Occupancy Taxes are usually paid only on the nightly rate plus any fees (excluding the Airbnb Svc Fee). Looks like State of Pennsylvania charges both the Host (operator) AND Airbnb (booking agent) a 6% fee. Carbon County charges 3% HOT.
I think this is how they are calculating it. You can review the State’s explanation of how they charge the 6% HOT on both you as Host on the nightly rate and cleaning fee AND 6% charge to Airbnb on the Guest Service Fee only. This is a bit unusual. Most states only charge the Host the HOT. If the state applies sales tax, it would apply to nightly rate, fees and Airbnb Guest Service Fee. You’ll have to read thru the info in the link below and then confirm this with Airbnb to be sure:
https://www.revenue.pa.gov/TaxTypes/SUT/Pages/Hotel-Occupancy-Tax-Booking-Agents.aspx
Sample Transaction
A customer books a hotel room for one night through a booking agent for a discounted room charge of $100.00. The booking agent charges a $20.00 accommodation fee for providing the service. The booking agent bills the customer as follows:
Discount Room Charge | $100.00 |
Accommodation Fee | +$20.00 |
Total Rent Charge | $120.00 |
6% PA Hotel Occupancy Tax | + $7.20 |
Total Amount Due | $127.20 |
Example Reservation
Nightly Rate + Fees (cleaning fee) = $639.20
$639.20 x 9% (combined state/county HOT) = $57.528 round up $57.53
Airbnb Svc Fee $90.24 x 6% = $5.41
$5.41 + $57.528=$62.94
Thank you for this explanation. I will review the info on the link you provided. This looks like it could be the answer I was looking for on why the amount is more than 9%. Thank you for your time!!
No worries 😊
I did look at another listing in your area and the calculation was the same on their listing.
yes I did the calculations for May and Jun and they numbers work when I add in the tax on the guest service fee for air bnb. Thank you.
I think this is a "creative" way for states to collect more tax revenue if they don't have a state-wide sales tax on STRs. Always an angle to generate more revenue.
It would be helpful if Airbnb added this explanation to the Occupancy Tax Section for Pennsylvania to prevent other Hosts from having the same issue as you when calculating taxes on reservations.
For the Hosts I consult for, there is a state-wide sales tax and therefore that is applied to nightly rate, fees AND the Airbnb Guest Fee. The Occupancy Tax is then only applied to the nightly rate and other fees like the cleaning fee.