Irish Airbnb clients who have been renting out their homes and rooms to people online are soon to find themselves paying a potentially hefty tax bill, following an announcement by the Revenue Commissioners.
The accommodation renting service has hundreds of users in Ireland renting out accommodation to holidaymakers and those seeking short-term accommodation, but now these Irish Airbnb clients will have to pay a backlog of income tax.
Users found an email from Airbnb in their inboxes over the weekend telling them that the issue of whether they would be required to pay tax had been under discussion between themselves and the Revenue Commissioners.
Airbnb will now be providing the Revenue Commissioners with information about amounts paid to Irish users of its service since 1 May 2014.
It now appears, based off the Airbnb statement, that the use of Ireland as a source of cheaper international tax has somewhat been detrimental to Irish users.
“The reporting requirement exists because, on 1 May 2014, Ireland became Airbnb’s home base for all transactions outside the United States,” the Airbnb statement said.
“There will be an ongoing obligation as part of our annual corporate filing obligations in Ireland, the first of which we will be filing in September.”
The statement concluded: “Now that we have clarity, we want to let our community know and address any questions they may have.”
As part of this, Airbnb will deliver a list of user information to Revenue for taxable reasons and any user who has questions about the income tax collection is being invited to a meeting at the company’s headquarters in the Watermarque Building in Dublin 4 at 6.30pm this evening (11 August).
A spokesperson for Revenue has said that the letting of rooms in the short-term does not fall under the rent-a-room relief scheme which allows people letting out a room on a long-term basis earn €12,000 per year tax-free.
Traditional Irish house image via Shutterstock