New Hampshire room and meal tax

[Robin8]

Do any of my fellow NH AirBNB hosts know how the rooms and meals tax works?  

[Jan11]

Hi David,

The minuses?

Jan

[David126]

I am in Colorado so may not be quite the same but here the Sales Tax can be complicated:

State 

County 

Town

These are the basic ones but there can be in some areas a lot more, there is a thread running about Denver where the list goes on and on.

The further you work down the list the less likey AirBnb will have an agreement collecting the tax. As far as I can tell AirBnb do not list individually the amounts they collect and remit and that has caused issues for some.

And then of course some people use other booking systems who do not remit.

[Suzanne75]

Hi Jan,

Airbnb does not have a separate line item for taxes, thus any money you take out of your total to pay for your taxes has also had a percentage taken by Airbnbj as the guest service fee and also the owner's fee. This includes when you do a special offer to add in the tax; the guest service fee charged the renters goes up proportional to how much tax you are charging. For example, let's say the percentage Airbnb charges is 5%. If your total pre-tax is $200, Airbnb will take $10 as the guest service fee. If you then send a special offer for $218 to add on your 9% sales tax, Airbnbs cut goes up to $10.90. This means that they are making .90 on the money your are collecting for tax purposes. They probably can get around this legally by not having it labeled as tax money on the website, but it is still wrong, and technically illegal.

In looking for citations about the legality of what they are doing, I came across a suggestion on the site that you collect tax through the resolution center. They do not charge a cut for this! I am going to do it this way, which will resolve the problem of them getting a percentage of the tax money, but not the cumbersome nature of the process. Thanks for adding your voice to this issue!! I am a superhost as well, so hoping with you that we will have sway! 

[Ann206]

I have been aware of the NH Meals and Rental tax and licensed and paying through their website : https://www.revenue.nh.gov/meals-rooms/.  I was renting my cottage through Craigslist and word of mouth previously, but just listed with AirBnB.  While exploring the other properties near my cottage, I found those in Maine did have their tax added to the total.  I read some of their online help about taxes, and it makes it seem that the site supports adding it to your lisiting AND sending a related tax form to the owner. Im surprised that AirBnB can treat their consituents unequally and state they support this necessary feature, but then do not in some states ... there's somthing wrong about that ! I will write a letter as well.

[Ray-and-Joyce0]

I'm fairly new to this, and did get my license, and have been paying the tax out-of-pocket until I can get Airbnb to do the right thing. In the mean time, I'm writing a letter to the NH Dept of Revenue to complain, and I urge all of you to do the same. I believe that the state will find them in violation of the law. There's no reason that Airbnb can collect for almost all the other states and quite a few cities, but not for NH.

Please, complain to the NH Dept of Revenue. It's revenue that the state is not collecting, and they are very sensitive to that!

[David126]

@Ray-and-Joyce0

Just include the tax in your listing price, I do not know how it works in CO but AirBnb collect State administered tax in Colorado, you will find many Hosts complaing that they do. I could be wrong but not sure any of the other booking systems collect tax and remit on behalf of a Host.

[Paul608]

Hi Ray, how and where do you get a license for airb&b? I just started hosting at my house here in Pelham, NH and didn't realize you needed one, did u get it from this site: ?http://www.revenue.nh.gov/faq/meals-rooms.

thank you,

Paul.

[Paul608]

Hi Ray, how and where do you get a license for airb&b? I just started hosting at my house here in Pelham, NH and didn't realize you needed one, did u get it from this site: ?http://www.revenue.nh.gov/faq/meals-rooms.

thank you,

Paul.

[Cole13]

Just an FYI to all on NH Meals and Room tax: I just got off the phone w/ NH Dept of Revenue Administration,regarding what is considered non-taxable income:

Nightly Rental Fee - taxable

Airbnb fee - deduct from above

Cleaning fee - taxable IF charged the fee to EVERY guest

For example:

3 nights at $100.00 = $300

Airbnb fee $10.00

Net Rental = $290.00

Cleaning Fee - $50

Taxable Meals & Room Tax Income = $340.00

If you collect the tax in addtion to your rental rate, you remit 9%.  If you incorporate it into your rental rate, you remit 8.26%.

I don't agree w/ them about taxing the cleaing fee but there you have it.  Would be interested to know if anyone else is getting different answers.

Thanks,

Cole

[Suzanne75]

Thanks Cole. That is the standard way its done in most if not every state. Services are taxable...

I've been charging the tax through the resolution center so that airbnb does not charge a fee for the tax. Works great.

Suzanne

[Laura1125]

This is a helpful string of comments, thank you. I recently registered with the NH Dept of Revenue Administration and received an operator's license.

I chose my rental fee with Meals and Rentals tax in mind, so am not collecting it separately from guests. I'm confused about the comments regarding airbnb fee and how that factors in and why folks aren't just including it in their rental fee.

I am about to submit my first payment to the state and am planning to use this calculation: My income is the amount I was paid out by airbnb (listed under stats). I'll then subtract the following deductions which I found online as acceptable: Utilities, real estate taxes, mortgage interest, homeowners insurance, cleaning and plowing. I've totaled the annual costs of these deductions and divided by 365 to get the daily amount which I will multiple by the number of nights rented last month. The remaining income is what I will use to determine tax amount due. 

I'm also confused by the comment that NHDRA said cleaning fees are income. I pay a cleaning company and am not clear why I should have to count that amount as income. The NH legislature established a study committee earlier this year to look at taxation and regulation of short term rentals such as airbnb, so my guess is people are still trying to get clear on how this all works. If anyone has comments regarding how I'm planning to calculate the amount I owe, I greatly appreciate it. 

[Jennifer409]

Hi Laura,

Its very easy. The office that handles this is great with helping out. [Phone number hidden]

I have started hosting back in April, this is how I make it known to guest about collecting the taxes.

ABOUT THIS LISTING:

Foliage Season is here, everything needed to relax & be able enjoy the tranquility of a small and quiet countryside town setting. Our haven is crafted w/knotty pine interior, furnished kitchen, LR, 2BR, 1 bath. Patio & yard offers privacy & room for relaxing, play & grilling. Quick access to hiking trails, great fishing & skiing. Short distance to Franconia Notch & Flume, Lost River Gorge, White Mountains. Rates don't include the NH Meals & Rentals Tax. NH Meals & Rentals Operator's Lic.#XXXXXX

THEN ONCE THEY BOOKED I SEND THIS MESSAGE:

Hi XXXXX, welcome to XXXXXXX. We are excited to have you and your family as our guests.

When it gets closer to arriving/check in, please let us know if you will be needing anything, and your approx. time for arrival.

Since Airbnb does not collect the NH Meals & Rentals tax for the state of New Hampshire host.

NH Meals & Rentals Tax of 9% (0.09) (includes cleaning fee) are charged to the guest directly from the host.

Airbnb doesn't let you enter any cent amounts, this tax is rounded to the nearest dollar. This tax includes the cleaning fee.

I will send payment request shortly.

TO SEND PAYMENT GO TO THE GUESTS RESERVATION INFORMATION 

Click on Request Money

SELECT A REASON:

EXTRA SERVICE

Request money

How much would you like to request from XXXXX?

$11

SKIP PHOTOS

ADD THIS TO XXXXX AS YOUR 

Since Airbnb does not collect the NH Meals & Rentals tax for the state of New Hampshire host.

NH Meals & Rentals Tax of 9% (0.09) (includes cleaning fee) are charged to the guest directly from the host.

Airbnb doesn't let you enter any cent amounts, this tax is rounded to the nearest dollar. This tax includes the cleaning fee.

$85(Nightly rate)+$40(cleaning rate) = $125 * 0.09 = $11.25

Please make payment of $11 before OR on your check in date. 

You can pay by going to: www.airbnb.com/resolutions

I do not receive payment for this, until 24hrs after check in.

Thank You,

NH Meals & Rentals Tax Operator's License # 

Once my current month of booking is complete, I fill out the DP-14 worksheet, and make payment by the 15th of the next month by phone or electronically.

 Hope this helps.

Jennifer

[Cole13]

Laura,

When it comes allowable deductions, I think you may be confusing taxable business "income" taxes w/ room and meal tax, which is akin to a sales tax.....based on gross receipts.   To my understanding, the deductions you mentioned (Utilities, real estate taxes, mortgage interest, homeowners insurance, cleaning and plowing), would only be applicable when doing your buinesse's income tax return, which is based on net income.  The room and meals tax is based on gross receipts, including cleaning fees collected.  The only allowable deduction is the Airbnb fee.  I just re-checked w/ NH Dept. of Revenue and they agree.  Hope that helps. 

[Jennifer409]

Laura,

If you have a set rate per night (doesn't change), it works out great. In my case my rates fluctuate.

You shouldn't add the the host fee to your 9% calculation or to your guest.  Hosts don't include it in their rental fee, because your guest get charged a separate guest fee from Airbnb.

Your cleaning fee is taxable, because it's a service you offer and get paid for. Keep your receipts if you are paying a cleaning company.

When paying monthly, you should just add gross income (nightly rate + cleaning fee).

I.e. For the month of September you will need to pay the following taxes.

$1346 (total amount made from your nightly rate) + $160 (total cleaning rate) =  $1,506 

$1,506*.09 = $135.54 tax to be paid would be $136 rounded to the nearest dollar.

Your other write offs you should contact your tax accountant. 

[Andrea1055]

Begining Nov. 1, airbnb will collect and remit NH Meals and Rooms taxes for hosts.  Seems your letter writing campaign and calls may have had a positive effect.