Renting on Airbnb & other platforms?

Airbnb Hosting can be a great way to boost your income, but it’s important to understand the tax implications to ensure you’re compliant with the ATO.

It's a great way to earn some extra income, but there are a few tax things to keep in mind to ensure you're squared away with the ATO.

How does the ATO treat income from Airbnb & other platforms?

The ATO sees income from Airbnb and similar platforms as taxable rental income.

This means:

You need to declare all income earned in your tax return.
The good news is you can claim deductions for expenses related to renting out your property, like cleaning fees, utilities you cover for guests and minor repairs.
GST does not apply to residential rent and, therefore does not apply in the case of Airbnb income.
You need to keep records of your income and expenses related to your Airbnb rental.
As you are earning income from the property, there may be capital gains tax implications in future, when and if you sell the property.

What deductions are available?

In addition to the expenses mentioned earlier, you can claim deductions for a variety of costs directly related to renting out your space on Airbnb or similar platforms.

Here's a more detailed list:

Running costs: A portion of your internet, phone, water, electricity, and gas bills, based on the percentage of time your property is rented and the percentage of floor space rented out.
Council rates and property insurance: A portion of these costs can be claimed based on the percentage of time your property is rented and the percentage of floor space rented out.
Maintenance and repairs: Costs associated with fixing things broken by guests or general upkeep related to rental use.
Cleaning and laundry costs: Expenses for professional cleaners or cleaning supplies you purchase specifically for Airbnb guests.
Loan interest: If you have a mortgage on the property, you can claim a percentage of the interest portion of your repayments.
Depreciation: The gradual decline in the value of furniture, appliances, and other assets used for your Airbnb. (Note: claiming depreciation can be complex, so please consult us first for advice).
Other expenses you can also claim for:

o Fees from Airbnb and similar platforms

o A portion of your home & contents insurance

o Landlord insurance

o Food and supplies offered to the guest

Since Airbnb listings are public, the ATO could potentially track down your property to ensure you're reporting your income correctly.

For more information, click here for the Airbnb Rental Income and Tax Return Checklist for Rental Property Income spreadsheet.

Please get in contact with our office if you are considering renting out your property or have any questions related to your rental income.

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