Does your AirBnB rental registers and documentations are proper?
Did you submit the necessary tax reports and declarations relating to the short term rental?
We are always at your service at any time with our consulting services or our full range of monthly fee servicelesseAuthority which is responsible for the AirBnB company’s taxation has sent the AirBnB listings and revenues for 2015 to the Hungarian Tax Authority. Based on this information, the Hungarian tax office is looking for the lessors who have not declared their income.
Unfortunately, our experience shows that even homeowners are not aware of what login tasks, taxation and taxes are incurred in relation to the short term rental advertised on AriBnB, Booking.com and similar sites who do not want to avoid taxes. That’s where our office can provide you with professional help to avoid future penalties and interest.
Let’s look at the most common deficiencies that landlords make from a tax perspective
Did you apply for a tax number for lease activity?
The most important thing is that the short term rental can only be carried out in possession of the tax number issued by the central tax office, even if it is done as an individuel, an enterpreneur or in corporate form.
If you missed to apply for a taxation number than you risk a serious penalty, furthermore if the tax office will notify you before you notice it then you can’t choose the best taxation structure, so you will pay much
more tax then it is necessary. With careful planning, the tax can be optimized with regard to available legal forms of taxation. It should be decided which one is the most favorable form of taxation for one or more flats and at different income levels, whether or not income should be distributed among several taxpayers, is it worthwhile to set up a company.
Did you choose tax exemption or are you under the general rule?
According to the general rule of the VAT Act, the AirBNB lease as short term rental service belongs to the taxable circle. This means that in the absence of a counterclaim, gross revenue is taxable with 18% VAT. So if you did not choose the tax exemption for taxpayer’s claim, which can be made up to an annual income of HUF 8 million, your income will be charged with 15.25% payable VAT from the gross amount. Unfortunately this can cause a significant loss of income.
Are the permits available? Is it lawful to rent your home?
It is imperative that short-term lease can not legally be carried out without the permission of the local authority. Obtaining these permissions is a time-consuming process, unfortunately many offices need to be visited until the final licence will be issued by the appropriate authority. Beside the preparation of tax returns and leading the registers our office is ready to help you in the applications and obtaining the necessary permissions.
Do you pay the building tax after the leased flat?
Yes, unfortunately you can’t avoid it. It is very important that after the land space utilized on AirBnB, you must pay the building tax corresponding to the local government’s decree. As this is a significant amount and the NAV is increasingly informing the local authorities about the lease, it may pose a significant tax risk for the lessor for 4-5 years period.
Did you register your business for the tourism tax?
Yes, as you are, when you go to a hotel and pay the tourist tax, your guests are also required to pay this kind of tax. You, as a landlord, have a duty to collect, record, declare, and pay to the local tax authorities of this tax.
Beyond that, it is still worthwhile to go through some other taxes to make sure we’re involved in it or not, such as local business tax, plot tax, toll dues, any taxes or contributions associated with employees.
We are always at your service at any time with our consulting service or our full range of monthly fee service.
