Tax obligations for Airbnb hosts in the Philippines

[David1747]

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?

[Karen1642]

Hi David, I’m a US permanent resident and I have a condo in the Philippines. I’m hoping to turn it into an airbnb and I’m curious as to what my tax obligation would be, which led me to your post. My question is how much is the tax for a business like this? I dont have a high end property and I’m looking into renting it for only $20-$25 per night. I’m checking my options if it’s worth the effort to do all this plus if it generates income it would be a reportable income here in the US.

[David1747]

Hi Karin,

I did not investigate what tax rates would be applicable once we received our legal advice that we would not have to declare our Airbnb revenue (because we live in the house). I assume that if you own the condo as an individual, then personal income tax rates would apply. Here's a link to the current rates on the BIR website: https://www.bir.gov.ph/index.php/tax-information/income-tax.html

Regards . . . David

[Tyler336]

Karen, did you ever follow through with this and try hosting airbnb in the Philippines? This is something that I have been really considering, buying a condo and renting it out about 9 months out of the year and staying there the other 3 months. I would plan to find a local that I can trust to help maintain/clean the room in-between each stay. let me know if you have any information on this TIA!

[MaryVida0]

Hi David!

I'm Mary from San Mateo Phils. also, a graduate school researcher about Airbnb, I found your comments here very helpful. Can I use some of your statements here for my present study? Thank you very much!

[Noime0]

Hi everyone! i am hosting my sister's 1 unit here in manila,and looking for rules and regulation that i want to post inside the unit,when i interestingly read the thread. well, i am also currently doing some work at the BIR with the help of my other sister who is working as a collection officer.i ask her about your issue on taxes and she told me that they are not familiar with airbnb but if there is a business it should be registered and that is an  SOP at the BIR.

[Noime0]

but for me,its a matter of conscience. if you want to help the country,why not......try to read about the "TRAIN LAW" maybe it will help you guys.i am also engage in documentation services,my business is registered eventhough i dont earn 3M above.i am also a property agent....

[Fredolin0]

My experience in our Airbnb Baguio is when personnels from the City Treasurers Office came to our condo unit and asked me to register it. Being a good Filipino citizen, I obliged and do all the necessary paper works to secure all necessary permits from the barangay, city fire departments, city treasure's office down to the BIR office. Since then, I'am doing the same yearly as a prelude in renewing our lisence to operate. I feel that it is my duty to comply all city requirements in order to protect my interest, if I encounter problem in the near future.

[Ivana271]

Hello i do have airbnb in philipines. But my income comming in my czech acount. Where i should pay tax? In czech r. Because there is my income? Thank you for help.:))

[Amby3]

Did they require you to secure a locational clearance? Did your condo bldg admin allow you to use your unit as a business address?

[Marifel2]

Hi Fredolino,  i have a newly hand over condo unit in baguio, planning to register it on Air BnB, can you please advice what are the things i need to consider?

Thank you very much for your reply.

[Ivana271]

Hello i would like to ask me (czech citizen) and my partner (philipino citizen) having 4 very simple nipa hut. The bussines and all papers are under his name. He does have BIR for this already but i am activ on airbnb ( renting under my name) and also our  income comming to my czech acount. Should i declare tax in Philipines or in czech? I can not have bussines under my name in ph because i have only visitor visa . Can i pay proper tax fro

m airbnb in czech and my partber is ok in philipines he will pay taxes just from walk in guests? Or is possible that he will pay taxes also from airbnb income even if income gping to czech acount - so than i dont have to declate income in czech because will be already paid in ph? Anybody can help? Thank you very much.

[Judy467]

There is 3% Business tax and you can also opt for 8% percentage tax under the new train law. If you want to  know more about the taxes you may want to search for Accounting Tutorial Center in Youtube. The staffs were very helpful and you can pm them via FB. I am not an affiliate. I just see them as a good source of Tax information for Small businesses. Hope this helps.

[Rowena37]

A pleasant day to everyone!

My name is Rowena Alcala and I am currently conducting research on AirBnB hosts in the Philippines who experience hosting different guests. Please help me gather insights from your answers to the survey. The questionnaire consists of 20 questions and will take about 15-20 minutes to complete. All responses will be kept confidential in this research. Your participation is extremely valuable in this research. Thank you in advance for your interest and assistance with this research. 

here is the link of the survey questionnaire: 

https://docs.google.com/forms/d/e/1FAIpQLSdqejlGiHdKa3IytV8yINp0CUAgaDTZNVsUVCdTaH7fYDLkkw/viewform?...

[David1747]

@Rowena37 I had a look at your questionnaire, Rowena, but there's no way I could complete it in 20 minutes. Some of the questions would require 20 minutes themselves to answer comprehensively. I'm not sure how many Airbnb guests would have the time to do that. Have you thought about contacting say 10-15 Airbnb hosts in and around QC to see if they would be willing to respond to a personal interview? Responding to your question verbally would take only a fraction of the time required to prepare written answers.

[Reese12]

You guys may read the this link .  

https://www.sunstar.com.ph/article/1805090