AirBnB withholding tax for non-US listings and non-US resident

[Jay18]

Recently AirBnB started withholding tax, which we believe is an amount for US income tax. The thing is, none of of our listings are in the US. The person who created the AirBnB account for the business who owns or leases the rental listings is a resident of the same non-US country. One AirBnB rep said that in order to avoid US income tax withholding, the company needed to open a business account. Anybody ever hear of that? I spoke with another AirBnB rep later, and they stated there was no such thing as a business account for hosting, only business accounts to find places to rent for their employees, etc.

[David1504]

Hi Marit Anne,

Unfortunately, I don't seem to have any say in whether I pay the tax or not as Airbnb deduct it automatically even though I've complained. The worst thing is I don't make any profit on renting my timeshare out as the HO fees at the resort consume all the income so I'm actually paying tax on a LOSS! Any additional advice you can provide to enable me to reclaim this tax would be appreciated but living in the UK all my life means I have no idea who to contact in the US to help me with this.

David

[David1504]

Hi Marit Anne,

Unfortunately, I don't seem to have any say in whether I pay the tax or not as Airbnb deduct it automatically even though I've complained. The worst thing is I don't make any profit on renting my timeshare out as the HO fees at the resort consume all the income so I'm actually paying tax on a LOSS! Any additional advice you can provide to enable me to reclaim this tax would be appreciated but living in the UK all my life means I have no idea who to contact in the US to help me with this.

David

[Marit-Anne0]

@Jay18

Sorry, I must have misread/misunderstood your question.

Did you list your vat number ? Perhaps that is the reason.

[Jay18]

@Marit-Anne0 AirBnB said this is for US taxes, not Icelandic taxes, so a VAT number would not matter. A private Icelandic corporation operating listings solely in Iceland is not subject to US taxes. Period. AirBnB goofed.

[City-Limits-Ranch0]

Are any of the owners/principals of the corporation American citizens?  The US can legally tax all American citizens no matter where they live or work and no matter if they don't provide any services in the US.

[Jay18]

@City-Limits-Ranch0 The company is a private Icelandic corporation. Having an employee who is a US citizen does not make the company liable for US taxes. Otherwise, the company would have tax obligations for employees from other countries as well. AirBnB only started withholding after they received an email from this company asking about why AirBnB was even mentioning withholding US taxes on it.

[Emma274]

Hi Jay,

I have just been deducted 28% from my expected earinings by Airbnb. It came out of nowhere so I googled and found your message. I have submitted my taxpayer information to avoid future deduction, however the amount has been witheld could not be refunded. I found it very unfair and unreasonable that Airbnb could just deduct money from my payouts which I worked very hard to earn. How did your case go? Ant result concluded?

Thanks and Regards,

Emma 

[Jay18]

@Emma274 Hi Emma - It seems to me that AirBnB holds all the cards. They hold the money, as well as the power to distribute it or not. In my case, we are drafting a letter to the IRS to ask their opinion on what AirBnB said. I am not sure how the IRS handles taxes for a private Icelandic corporation, although eventually we hope to find out. AirBnB has probably withheld thousands of dollars at this point. Once I know, I will update the thread here, or on another site errbnb com if AirBnB removes these posts.

[Emma274]

Hi Jay,

Thank you so much for your response. Airbnb has recently assigned a new customer service reprensitive and careless replied me that the amount deducted was VAT, which is a totally differnent concept from their initial reply. The amonut deducted was based on my payouts, did not even match the percentage of VAT. Obviously they took my case less serious than yours.

I will keep pursuing for an action of refund and your shared experience has been really helpful. Thank you again and good luck to your case!

Regards,

Emma 

[Jay18]

@Emma274 Yikes! That's a bit scary, isn't it? AirBnB doesn't know what they are doing. Seems to be a growing trend, unfortunately.

I will post back with the results of my case; please post back with the results of your case. Cheers!

[Joachim36]

Hi Emma,

I have the same problem. It came out of nowhere, I am from The Netherlands.

They deducted 28% of my bookings and tell me I don't get my money back. 

Did you find a solution??

[Nan18]

Hi Emma

Does airbnb still withold your tax? I have same situation, non-american list, non-american resident, non-american income, but they start to withold 30% tax from this year october, I filled W8ben form, do you think it will stop them withold tax? Customers cannot help and answer my question. Could you kindly share your experience to me?

Thanks a lot!

[Ant2]

Did you resolve this issue yet? I am a host in South east asia and I have recently found that they had withheld tax of 28%. I do not have properties in US nor am I a US citizen. We have called in and reach their support but to no avail. They are very blur and each support representative gave us a different answer. 

[Jay18]

@Ant2 AirBnB has been completely unreasonable in this matter. Our company is writing a letter to the IRS in America asking for their opinion, since we have a legal opinion here in Iceland that what AirBnB did is not only incorrect, but is possibly illegal under local law. I really, really hope that is the case, because given how poorly AirBnB has handled this whole matter, it would be nice to see them in hot water over their actions. If AirBnB treats you like they did us, then they will tell you that they are in the right unless you prove them wrong. Get a local legal opinion, and make sure to file charges against them if they broke your laws.

[Samah0]

Has this been resolved? I am in Cairo egypt and i am facing the same situation! Any help would be greatly appreciated