UK Service Fee Change - Existing Bookings

[Ian56903]

Hi,

I am planning on using the automated tool to update nightly rates to take into account the service fee being paid solely by host. 

When I apply the tool it updates all rates from today onwards including rates for existing bookings. 2 questions - 

1) Why are dates before May / Junewhen  the fee change comes in  being auto updated?

2) Will guest with existing booking see any difference or will old fee structure still apply?

Thanks

[Shelley159]

The guest will see one price anyway @Nicholas558 , Airbnb has switched to displaying the cleaning fee as part of the total cost a guest sees.

The service fee (and the VAT on the service fee) also applies to the cleaning fee, so there's no difference if you keep the cleaning as a separate per-booking charge (a cleaning fee can make pricing for changeovers more accurate).

[Ray2330]

I spoke to support about the VAT on the host only fee and received the following feedback:

The 20% VAT on Service Fees

- In the UK, Airbnb is required to charge 20% VAT on their service fees.

- Is it included? Yes. For UK hosts, Airbnb’s stated 15.5% fee is VAT-inclusive.

- This means the actual service fee is roughly 12.92%, plus 2.58% for VAT (which is 20% of the fee), totaling exactly 15.5%.

- Since the Price Adjustment Tool used the total 15.5% figure to set your new rates, it has effectively 'baked in' the VAT cost for you. You aren't paying an extra 20% on top of the 15.5%.

[Shelley159]

@Ray2330 I would recommend that - when your first transactions come through on the new fee structure - you just keep an eye on the calculation and make sure that the VAT really is included in the 15.5% (otherwise you'll get out less than expected).

I'm still on the split fee, but I can say with certainty that for me both the published host and the published guest service fee percentages (3% and roughly 14.2% respectively), exclude VAT. This is how it shows in the payout breakdown:

So just double-check the VAT on a completed transaction when you have the chance.

[Ray2330]

After posting the info from Airbnb support above, I did think "hang on, that doesn't sound right!". I did aa calculation on my nightly rate and it does look like the deduction is host service fee + VAT> I have queried this again with Airbnb Support as I think the first advice is incorrect.

[Ray2330]

So I heard back from Airbnb support again and after a quite tortuous phone call when they repeated the incorrect information while acknowledging that the nightly rate figures I provided to them showed that what they were saying was incorrect, they finally acknowledged that VAT is being charged on top of the single service fee (in the UK). In practice, this means that the actual deduction made by Airbnb (service fee and VAT) is 18.8% of the nightly rate. 

I expressed my frustration at the shocking lack of clarity on this, including in their recent email and attached information!

[Shelley159]

👍 I think18.6% including 20% UK VAT. I agree with you it's unlikely that the 15.5% already includes the VAT in the UK.

[Gail1141]

This is exactly the query I had - Airbnb support, eventually, after a very painful and long phone call, confirmed that VAT had not been taken into account and the pricing tool will not 'bake it in'. I was on the Webinar this evening and this question was not raised at all. So as Shelley says, the calculation is nearer 18% to cover the VAT element too! and this will need to be done manually!

[Sally144]

Thanks for this Ray. Really important information 👍

[Sally144]

Spoke too soon! And I was so delighted to hear this. Oh well 🤣