Nowhere to hide for Airbnb hosts as Revenue tightens the tax net

Owners looking to let out properties on Airbnb must now hand over their personal tax details to the global home sharing platform, as Revenue steps up its oversight of the business.

While the accommodation portal has been sharing information on Irish host earnings with Revenue for some years now, a recent legislative change in Ireland means Airbnb is now also asking hosts for their PPS (personal public service) numbers, as well as the local property ID of the property being let out.

Airbnb says that “this information will be shared in addition to the information we’re already required to provide to the Irish tax authorities related to your earnings”.

The new rules apply to all hosts who are Irish tax-resident and to anyone with a listing in the Republic.

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“Hosts want to pay their fair share of tax and we want to help,” a spokesman for Airbnb said. “That’s why we offer a range of support to hosts from a free independent tax guide to tools to help with submitting filings. We have now updated the platform to allow hosts to share their taxpayer information in line with the updated Irish tax reporting rules.”

The move follows an amendment to the Taxes Consolidation Act, 1997 in 2019, which states that anyone “who, as an agent, either manages premises or is in receipt of rents or other payments from premises” must now supply both their PPS number, as well as the local property ID of the property being let out.

Annual return

While the changes came into effect in 2020, the data will not be reported until Airbnb files its annual return for 2020 with Revenue, which will happen in the third quarter of this year. This is why Airbnb is requesting the information now.

It is not clear what might happen if a host refuses to provide this information. Airbnb did not respond to this question.

The property-sharing portal has been hit by the pandemic, with most recent figures showing that revenues at Airbnb’s main Irish subsidiary halved during the first nine months of 2020, due to the Covid-19 crisis.

In its early days operating in Ireland, homeowners flocked to the portal to let out rooms or entire properties in the belief that such earnings would be tax-free up to the limit applied to the rent-a-room scheme. This allows you to earn up to €14,000 a year with no tax liability.

However, Revenue subsequently clamped down on this, a view which was confirmed in the Finance Act 2018. It states that rent-a-room relief does not apply to short-term guests, such as those booking through online accommodation sites.

Every September, Airbnb submits a report to Revenue detailing all rental income earned by Irish resident hosts in respect of both Irish and foreign listings, as well as all rental income earned by non-Irish resident hosts in respect of Irish listings.

Tax on rental income earned from the site can be as high as 52 per cent, with some deductions allowable, such as commission, cleaning etc.