Airbnb Tax Returns
There are many ways to turn your available assets into profit generating assets. Airbnb is a popular sharing economy website. It helps property owners and investors earn extra income. You won’t pay too much on set-up fees, administration fees, or other complicated registration expenses. Airbnb only charges hosts a 3% service fee for each booking on its website.
Maybe you own a house and want extra cash for a holiday trip. Or maybe you rent an apartment and want to reduce your rent. The good news is that GST does not apply to residential rent.
However, rental income is still assessable, and income tax applies to all Airbnb earnings as a result. Therefore, we strongly advise you to record and declare all rental income to the ATO without exception. For instance, even if you do not declare your Airbnb income, the ATO can still figure it out on their own. Your Airbnb transactions are recorded online. Clear evidence shows your intention to make a profit from your property.
- Any fees and charges relating to the sharing economy services
- The property administration fees
- Council rates
- Interest on loan
- Electricity and gas
- Property insurance
- Cleaning and maintenance costs
- Fees and commission charged by Authorities
Keep in mind that your deduction amount depends on two things: the time you used the property for profit, and the portion of the property used for that purpose.
Our clients frequently ask us several questions for their Airbnb tax returns. Below are some common examples:
- Can rent paid be deductible?
- Can you claim and apportion items like TVs, air-conditioning units, and other electronics?
- Can you claim plant purchases?
- We installed a new floor. Can we claim this?
- I have a mortgage; can I claim a portion of this?
- How does CGT apply to our situation?
- Would the ATO consider you a business owner or a property investor if you rent out your whole property through Airbnb?
We understand that there could be a myriad of other questions you may have pertaining to Airbnb tax returns. Here is some peace of mind: we at A One Accountants can confidently answer all of your questions. Moreover, we can also assist you in preparing and lodging your Airbnb-related tax returns.
For property owners, renting out part of your property can trigger CGT consequences. This becomes especially important if you decide to sell the property in the future.
Questions about Airbnb income tax can be complex and require a profound understanding of tax. We have prepared many tax returns for Airbnb and similar sharing economy platforms. We fully understand what you can and cannot claim.
The above article includes a disclaimer. Please contact us on 03-86091889 for a full copy. Or send us an email at info@a1accountants.com.au.