Airbnb
GST or Not on Airbnb? Should I be registered?
Can I Claim GST on the purchase of the property? What does it mean that the vendor is or is not GST registered?
Is there Tax on Airbnb?
Should i use a host?
Who can help me dress my property?
Contact us to arrange an appointment to discuss all these points.
If you are GST registered-What if your Guests stay longer than 4 weeks- It matters.
Four-week rule for residential establishments, such as boarding hostels or rest homes
If there is an agreement that the stay is for more than four weeks, GST must be charged on 60% of the value of domestic goods or services from the start of the stay.
Rest homes and private hospitals
In Tax information Bulletin Vol 6. No 2 (August 1994) standard rates were published for the apportionment between domestic and non-domestic goods and services for rest homes and private hospitals.
The rates that will generally be acceptable to Inland Revenue are as follows:
Rest Homes -45% domestic goods and services.
-55% non-domestic goods and services.
Private -35% domestic goods and services.
Hospitals -65% non-domestic goods and services.
Rest homes and private hospitals may also use a factual basis for apportionment if they believe that the above rates are not consistent with the supplies they make, provided they have sufficient records to support their calculations.
As explained in the Tax Information Bulletin, the apportionment rates can also be simplified down to composite rates of GST.
The composite rates of GST are:
Rest homes: 12.3% (10.25% before 1 October 2010).
Private hospitals: 12.9% (10. 75% before 1 October 2010.
GST on special supplies (a - e)
Accommodation:
The supply of residential accommodation in a dwelling is exempt from GST. However, accommodation in a hotel, motel, other commercial dwelling, hospital or residential establishment may include GST.
If your taxable activity is a hotel, motel, or other commercial dwelling. the GST on the accommodation (domestic goods or services) is calculated in two different ways:
four-week rule for commercial dwellings.
four-week rule for residential establishments.
Four-week rule for commercial dwellings:
Charge GST on the full value of accommodation in hotels. motels and other commercial dwellings for the first four weeks' stay.
After four weeks, charge GST only on 60% of the value of the domestic goods or services. These are usually the right to occupy the premises and any of the following if they are included in that night.
cleaning and maintenance
electricity, gas, air-conditioning or heating
telephone (not tolls). television, radio or similar chattels
If a joint charge covers all supplies for bed and breakfast, the fully taxable supplies (breakfast) must be separately identified from the domestic goods or services (bed).
Please contact us - There is a lot more involved than you originally think.
2. Can I Be GST registered? Should I be GST registered? Both Depend on your circumstances, value of turnover.
3. But it’s just my holiday Home.
Common Misconception:
If I buy a holiday home and rent it out, I don’t have to pay tax on the income tax I earn.
What the law says: Not quite. If you are renting the holiday home out long-term, it gets treated like a residential rental and you will need to declare the income. If it is not long term rental but you make more than $4,000 for the year from renting it out then you will have to declare the income you earn when you complete your tax return. If your income from renting the holiday home is less than $4,000 for the year and it is used for less than 62 days in the income year, you can opt to keep the holiday home outside the tax system.
