Thinking about running an Airbnb?
Small accommodation operators, such as those that use Airbnb help to provide some very useful infrastructure for our tourism industry - especially where hotels haven't quite yet reached.
People get to see some previously unreachable parts of our country and get a closer connection with what Kiwis are like. There's nothing more personal than Kiwi hospitality in a real Kiwi house.
It can also be a lucrative business - some operators make a tidy sum of close to $40,000 gross off an unused portion of their house. So what might you need to know?
If you're making profit you're going to have to think about taxes. The IRD will be watching platforms such as Airbnb and Bookabach to make sure taxpayers are complying.
You need to keep receipts so make sure you keep them - up to seven years' worth of records. It should be simple to keep track of which of your expenses relate to Airbnb services.
Coffee/tea and food provisions for guests are easy to justify - you can claim 100 per cent of those. For shared expenses such as rates, interest, power etc the calculation is a little more involved. Research the IRD website or talk to an accountant to help you.
House insurance may also not cover your operation - make sure you ensure you're covered.
GST is something you need to think about but only if you turn over more than $60,000 in 12 months. GST registration means more compliance with filing GST returns and increasing your price by 15 per cent (will this affect your patronage?) unless you're willing to absorb the costs.
If you're looking to buy a house solely for short-term accommodation use and you don't plan to live in it, there are separate - mixed use asset rules - that apply. This is more involved and you should get expert advice before you dive in.
Jeremy Tauri is an associate at Plus Chartered Accountants.
Phone: (09) 438 3322
Fax: 438 8455
134 Bank Street, Whangarei
If we had to sum up Brent and the team at Plus CA it would be - humorous, efficient, professional with a real focus on making your money work to its best ability for you...we will continue to deal with them even though we are moving overseas as we know they have our best interests at heart.
Jeremy thank you for your patience, assistance and general chit chat over the years. I would have absolutely no issue in recommending your services to everyone and anyone – in fact, I do.
We recently employed Jeremy Tauri of Plus Chartered Accountants and have been thrilled with the improved service we have received. Jeremy is really approachable and always available to answer queries. At his instigation we have set up quarterly meetings so that we are regularly reviewing our business and avoiding any ‘end of year surprises’.