My wife and I have been hosting through Airbnb since the beginning of the year and we have been trying to find out what our tax obligations are. We have been getting conflicting information. Barangay officials and City Hall officials have no idea what Airbnb is, so they've not been helpful. They just refer us to the BIR, but the officials in our local BIR office have never heard of Airbnb either, so the only advice we've got is that "maybe" we should be paying the 3% percentage tax that applies to small businesses who are not big enough to apply for VAT registration. But we don't consider ourselves to be running a business. We are just retirees looking to meet people and earn some supplementary income to help pay our bills. And we can't register with BIR unless we have a business name.
So I've been doing some research online and all I have been able to find out so far is that if you are renting out an apartment or house in which you don't live, then it should be registered as a business (either sole trader or corporate) and you need to apply for business name registration, barangay permit, mayor's permit and BIR registration and then pay income tax (personal or corporate) based on your income less allowable deductions. So that part is clear.
What is not clear is the tax obligations of people like ourselves who are living in a house or condo and just renting out one or two rooms. Back in 2015, the
Philippine Hotel Owners Association (PHOA) lobbied the Department of Tourism (DOT) to apply an occupancy tax on Airbnb hosts because they felt Airbnb places were unfair competition for hotels. The DOT has acknowledged the PHOA's concerns and has said that their present thinking is leaning towards regulating listed host establishments on Airbnb, but it does not appear that any decision has been taken on this yet. Specifically, Maria Rica C. Bueno, Director, Office of Tourism Standards & Regulations, Department of Tourism said: “At this point in time we don’t have a policy or a program yet, on how to address Airbnb. While we are in the process of processing and developing accommodation standards, we will get insights from the industry and our consultants on how we will address this issue."
Does anyone have any other updates on this, because that quote was from 2015, and I can't find any references to any decisions that may have been taken in relation to the tax obligations of Airbnb hosts in the Philippines in the past three years?