AirBnB Megathread - ALL A&P related Airbnb discussion here please

Eric Cartman

markpb wrote: »

I thought Revenue had decided that rent a room didn't apply to short term lettings like AirBnB?

well then thats me told, ignore that bit op.

wyndham

What's the public liability insurance situation? Do air bnb cover you?

68 lost souls

The other problem I foresee is the landlord seeing their apartment on Airbnb. I'm assuming the lease states makes reference to subletting and or guest staying more then a number of nights?

Ericdravancrow

Most lease's don't allow for sub-letting

Baby01032012

Eric Cartman wrote: »

well then thats me told, ignore that bit op.

Also if it did qualify for rent a room which it clearly doesn't as for short term lets and fact they are tenants not owner occupiers the limit is 12k not 10k.

Love people who correct someone only to give much more incorrect information

Peregrinus

jlm29 wrote: »

Except that revenue don't recognise unmarried couples as a partnership.

They don't recognise them as a married couple - which presumably is the outcome the couple hopes for when they choose not to marry. But Revenue will certainly recognise them as a business partnership, if they're carrying on business in partnership together. Note that simply co-owing a leasehold interest in a single property, though, is not caryring on business in partnership, even if you sublet a room.

jlm29 wrote: »

I find it very annoying that I can't claim tax credits for my partner, and vice versa, like our married counterparts. Revenue can't have it every way!

Revenue don't have it every way; you do. You can marry, in which case you are entitled to have Revenue treat you as married, or you can remain single, in which case Revenue must treat you as single. Your choice, not the Revenue's.

On the wider issue, assuming that both of the couple have their names on the lease, then any income they get from subletting a room in the property is joint income, and they should each report their half to the Revenue. It may cause an issue with the landlord, but the Revenue aren't interested.

Different if the lease is in her name only. In that case, all the income should be reported by her. And if the lease is in his name only, it should all be reported by him.

Obviously, if they marry, it will make no difference in the long run which of them reports the income. But as long as they remain single it does potentially make a difference, and they should each be reporting their share of the income.

As others have noted, subletting a room may be a breach of the lease, but I don't think that's relevant to the tax liablity.

P. Breathnach

Eric Cartman wrote: »

tax avoidance is perfectly legal and should be encouraged at every possible opportunity.

Tax evasion is the illegal one the mod was talking about.
OP , you should be able to avoid tax by doing it all through your OH's details...

Representing what is essentially a joint income as the income of a single party crosses the line from avoidance to evasion.

solargain

Its your property you need to get your own insurance and you need to tell the insurance company that you are doing short term holiday lets. Airbnb are only a letting/ bookings company

I too have been with airbnb for some time, for the most part the guests are very good and most respectful to the property , we had one head the ball lately who really wanted servants and a hotel ,( but that is a thread for another posting) other than that no problems with them. I think that they look after it better because they know you will be reviewing them after as well. Unlike the other self catering bookings we get , who walk out and don't as much as pick up their socks from under the beds not to mind put the garbage out

maxmarmalade

Thanks for responses, there doesn't seem to be a consensus. Im going to go ahead and put everything in my partners name. I think this is legitimate tax avoidance.

I haven't looked at the details of the lease, but the landlord said using Airbnb was fine.

frash

Hi,

I saw another thread pop up on the home screen about AirBNB and tax and it got me thinking....

My father in law has a house in Cork that he rents out in the Summer. Last Summer was slow so I suggested using AirBNB and I set it up in my name as he's not very savvy about things like this.

It rented out for 3 weeks with AirBNB and the money was paid into my account and then I transfer it to him.

Will Revenue be told that I earned this or is there a minimum that has to be reached before AirBNB & Revenue talk?

maxmarmalade

Peregrinus wrote: »

They don't recognise them as a married couple - which presumably is the outcome the couple hopes for when they choose not to marry. But Revenue will certainly recognise them as a business partnership, if they're carrying on business in partnership together. Note that simply co-owing a leasehold interest in a single property, though, is not caryring on business in partnership, even if you sublet a room.


Revenue don't have it every way; you do. You can marry, in which case you are entitled to have Revenue treat you as married, or you can remain single, in which case Revenue must treat you as single. Your choice, not the Revenue's.

On the wider issue, assuming that both of the couple have their names on the lease, then any income they get from subletting a room in the property is joint income, and they should each report their half to the Revenue. It may cause an issue with the landlord, but the Revenue aren't interested.

Different if the lease is in her name only. In that case, all the income should be reported by her. And if the lease is in his name only, it should all be reported by him.

Obviously, if they marry, it will make no difference in the long run which of them reports the income. But as long as they remain single it does potentially make a difference, and they should each be reporting their share of the income.

As others have noted, subletting a room may be a breach of the lease, but I don't think that's relevant to the tax liablity.

We only just moved in and haven't signed the lease yet, will have to make sure she signs it and not me!

maxmarmalade

P. Breathnach wrote: »

Representing what is essentially a joint income as the income of a single party crosses the line from avoidance to evasion.

Not if the lease is in my partners name it seeems. We are signing next week, so I wont go anywhere near it.

maxmarmalade

By the way, if Airbnb turns out to be too much hassle, I presume we can just sublet the room and this falls under the rent-a-room scheme of 12k tax free?

Peregrinus

maxmarmalade wrote: »

Thanks for responses, there doesn't seem to be a consensus. Im going to go ahead and put everything in my partners name. I think this is legitimate tax avoidance.

It's not, seriously. You don't avoid tax on your income by having it paid into someone else's bank account.

And if this goes wrong, it goes quite badly wrong. You're failing to declare your income and are liable to tax, interest and penalties. You don't get any credit for the tax she paid on the income she wrongly declared, and she doesn't get an automatic refund of that tax. She'll have to apply for a refund and in the circumstances she may not get it, since her original intention in declaring the income as hers was fraudulent. The longer this goes on before it comes to light the more you stand to lose.

But don't take my word for it, or the word of any other pseudonymous boardie. This is definitely a case where spending a couple of shillings on professional advice would be a sound investment.

Peregrinus

maxmarmalade wrote: »

By the way, if Airbnb turns out to be too much hassle, I presume we can just sublet the room and this falls under the rent-a-room scheme of 12k tax free?

Yes. Note that it's 12K between the two of you, not 12K each. You each still have to report your share of the income, but you won't pay tax on it.

Note also that if your income from letting rooms exceeds 12K in a year you don't just pay tax on the excess; you pay tax on the lot (but you get a deduction for expenses incurred in letting the room).

maxmarmalade

Peregrinus wrote: »

It's not, seriously. You don't avoid tax on your income by having it paid into someone else's bank account.

And if this goes wrong, it goes quite badly wrong. You're failing to declare your income and are liable to tax, interest and penalties. You don't get any credit for the tax she paid on the income she wrongly declared, and she doesn't get an automatic refund of that tax. She'll have to apply for a refund and in the circumstances she may not get it, since her original intention in declaring the income as hers was fraudulent. The longer this goes on before it comes to light the more you stand to lose.

But don't take my word for it, or the word of any other pseudonymous boardie. This is definitely a case where spending a couple of shillings on professional advice would be a sound investment.

Ok thanks, ill seek advice. It would seem though that it depends on who has signed the lease - if i haven't signed it they cant touch me.

Amazing the lengths we have to go to avoid pay yet more tax - I pay 4K+ income tax per month:( - and Apple get away with 13 billion. What a country.

Sleeper12

Rent the room out under the rent a room scheme. Earn up to 12k tax free. It's honest, tax free & you'll be helping with the housing crisis.

Peregrinus

maxmarmalade wrote: »

Ok thanks, ill seek advice. It would seem though that it depends on who has signed the lease - if i haven't signed it they cant touch me.

Strictly speaking, it depends on whose name is on the lease. If the lease names you and your girlfriend as tenants, and you move into the flat together and occupy it and pay the rent stipulated in the lease and soforth, I don't thin the fact (if this is the case) that by oversight you never signed it is of any great signficance (in this context).

But if the lease names just your girlfriend - let's say she was already renting the flat when you got together, and later on you moved in by agreement - then it's different. In that case there's probably a good case to be made that she's a the tenant and you're her guest (OK, paying guest, if you contribute to the rent) and any income from subletting a room belongs entirely to her.

aphex™

It's still technically in your name if you don't change your AirBnB account to your partner. Do you think AirBnB just give the IBAN to Revenue? No.

Changing the IBAN it goes into wouldn't change your tax liability. Looks like your partner would need to start a new AirBnB account. Then the tax liability would accrue to your partner who would use their tax credits.

Also with IBAN I believe the account name has to be correct due to AML stuff. So, they would initiate a transfer to your partner's IBAN but use your name and then the payment might bounce.

Sleeper12

Air B&B report all payments to the revenue. Revenue are tough to deal with but if your father in law is old, can't use computers and you now put it in his name revenue might buy the story

maxmarmalade

aphex™ wrote: »

It's still technically in your name if you don't change your AirBnB account to your partner. Do you think AirBnB just give the IBAN to Revenue? No.

Changing the IBAN it goes into wouldn't change your tax liability. Looks like your partner would need to start a new AirBnB account. Then the tax liability would accrue to your partner who would use their tax credits.

Also with IBAN I believe the account name has to be correct due to AML stuff. So, they would initiate a transfer to your partner's IBAN but use your name and then the payment might bounce.

Yeah yesterday my partner created a new Airbnb account so everything is in her name.

maxmarmalade

Sleeper12 wrote: »

Rent the room out under the rent a room scheme. Earn up to 12k tax free. It's honest, tax free & you'll be helping with the housing crisis.

Most likely I'll end up doing this. The dream was to live alone and rent a weekends using airbnb. But the more i look into it, then more difficult its proving.

noodler

maxmarmalade wrote: »

I recently moved into an apartment with my girlfriend. Its a 2 bed and costs 1,600 euro per month. We are planning to rent to spare room on Airbnb.

Currently I pay a marginal rate of income tax of around 52%, possibly more. I presume if I was to use my bank account details, Airbnb will release these to revenue and tie it to my earnings, meaning I would pay 52% and more on anything from Airbnb?

My girlfriend earns about 25k meaning she pays a marginal tax rate I would guess around 22%. Can I just change my bank account details to my girlfriends bank account details (on my own Airbnb account which has reviews which I'd like to keep for becoming a host), and the Airbnb earnings will be tied to her salary, meaning we pay a much smaller marginal rate?

Is there any way Revenue can get me for tax (even more so than they currently do) if we have everything in my girlfriends name?

By the way, I have quite a few friends who are using Airbnb, and have never paid a penny in tax, nor do they think they ever will. I presume this actually isnt the case?

Your Girlfirend's marginal rate is not 22%

It is 20% income tax plus USC (about 5%) plus PRSI (4% USC)

i.e.29%


Whats more, it will become 52% as soon as her income exceeds 33,800.

maxmarmalade

noodler wrote: »

Your Girlfirend's marginal rate is not 22%

It is 20% income tax plus USC (about 5%) plus PRSI (4% USC)

i.e.29%


Whats more, it will become 52% as soon as her income exceeds 33,800.

Jesus, i didnt realise the marginal rate on 33,800 is 52%. Extraordinary. What a country. Incidentally, what would the marginal rate be ion say 100k? 55%?

Michael D Not Higgins

frash wrote: »

Hi,

I saw another thread pop up on the home screen about AirBNB and tax and it got me thinking....

My father in law has a house in Cork that he rents out in the Summer. Last Summer was slow so I suggested using AirBNB and I set it up in my name as he's not very savvy about things like this.

It rented out for 3 weeks with AirBNB and the money was paid into my account and then I transfer it to him.

Will Revenue be told that I earned this or is there a minimum that has to be reached before AirBNB & Revenue talk?

You'd effectively have been an agent receiving the money for your FIL. You didn't earn it as it wasn't your property.

Get him to pay the tax and you'll be clear if Revenue come knocking.

Peregrinus

maxmarmalade wrote: »

Jesus, i didnt realise the marginal rate on 33,800 is 52%. Extraordinary. What a country. Incidentally, what would the marginal rate be ion say 100k? 55%?

Marginal rate of income tax plus USC for someone earning over 100k is 51% if self-employed, 48% if employed. PRSI is on top of that; If she's a class A employee (which is the commonest) that would be another 4%, bringing her to 52%.

frash

Michael D Not Higgins wrote: »

You'd effectively have been an agent receiving the money for your FIL. You didn't earn it as it wasn't your property.

Get him to pay the tax and you'll be clear if Revenue come knocking.

cool thanks

noodler

Peregrinus wrote: »

Marginal rate of income tax plus USC for someone earning over 100k is 51% if self-employed, 48% if employed. PRSI is on top of that; If she's a class A employee (which is the commonest) that would be another 4%, bringing her to 52%.

Its 52% for an employee and 55% for a self employed person.

markeymark

Hello,

I recently put a room in my house on Airbnb to make a little extra cash and I am aware that Revenue has stated that Airbnb profits are subject to tax at the marginal rate. However, I have had a request to rent the room for a full 3 months from a student attending an English course. I'm not interested in evading tax but I believe that as this is a 'long term' rental, I can take advantage of the rent a room scheme and rent tax free. Would anyone have an opinion on this, or would I be better off clarifying with Revenue?

Thx,
M

maxmarmalade

OK thanks. So what I'll do is have lease signed in partners name, keep Airbnb earnings below 8,000 for year (otherwise it would push partners earnings up into 52% marginal rate) and declare everything in her name. Will also get professional advice to make sure this is water-tight.