• Login:
Welcome, Register Here
follow PropertyTalk on facebook follow PropertyTalk on twitter Newsletter follow PropertyTalk on LinkedIn follow PropertyTalk on facebook
Results 1 to 10 of 10
  1. #1

    Default Airbnb and taxation

    We have set up a room in our home for airbnb and have it let most nights of the year. I know you have to pay tax on all income. The room is available all year. From a taxation point of you what can I claim as expenses. Am I entitled to claim depreciation on all furnishings, heat pumps, rates, power etc. Any comments appreciated.

  2. #2

    Default

    Anything that you run as a commercial concern should be depreciable, much as a computer is for my business. The tricky one will be interest on your mortgage as far as I can tell.
    Free online Property Investment Course from iFindProperty, a residential investment property agency.

  3. #3
    Join Date
    Oct 2013
    Posts
    1,617

    Default

    In short, yes. You can claim depreciation on furnishings, as well as a portion of your home insurance, electricity, rates, mortgage interest (not principal) and other household expenses.

    The actual proportion will be a matter of some discussion and calculation with your accountant.
    AAT Accounting Services - Property Specialist Accounting - AATAccounting.co.nz
    Lower fees for investors, traders & real estate agents!
    [email protected] for more information.

  4. #4

    Default

    thanks for those comments. When is it under the rules for holiay homes and when is under a business

  5. #5
    Join Date
    Jun 2004
    Posts
    10,367

    Default

    Quote Originally Posted by elliot View Post
    thanks for those comments. When is it under the rules for holiay homes and when is under a business
    When IRD decide.
    Looks like a bit of a grey area.

  6. #6
    Join Date
    Oct 2013
    Posts
    1,617

    Default

    Quote Originally Posted by elliot View Post
    thanks for those comments. When is it under the rules for holiay homes and when is under a business
    You're talking about letting out a room in your own house, so that is not a holiday home - technical tax term is 'mixed-use asset'.

    If you were letting a whole house on Airbnb, and occasionally used the house yourself, it is mixed-use.
    AAT Accounting Services - Property Specialist Accounting - AATAccounting.co.nz
    Lower fees for investors, traders & real estate agents!
    [email protected] for more information.

  7. #7

    Default

    hey guys not sure myself and you seem to know what you are talking about. I'm just interested to know if airbnb would fall under this category:
    http://www.ird.govt.nz/income-tax-in...ers-flyer.html
    Thanks

  8. #8
    Join Date
    May 2007
    Location
    Hamilton
    Posts
    3,594

    Default

    Hi all,

    1) they are not boarders. It is short term accommodation

    2) Not mixed use (holiday home) rules either

    3) Main part is working out what portion of expenses you can claim. Overall needs to be fair apportionment. You would take into account
    - number of people in the house. ie if mum, dad and two kids, plus one Airbnb. In simple terms they will use 1/5th of your power, internet, sky for the period of their stay.
    - area used by Airbnb (exclusively) - could be room, seperate lounge?, seperate bathroom etc. So might be 25m2
    - shared areas used and days used- toilet, bathroom, kitchen, lounge, hallways) might be 85 sqm. So might be 1/5th of these, but only renting for 1 day per week, so 1/7th of time. So business use = 85*1/5*1/7 = 2.4m2
    - total house = might be 225m2

    - Rates, insurance, interest - would claim 27.4/225 = 12%
    - power, internet, gas, sky - Would the 12% be fair? Probably not as only 1/5th Airbnb, but only staying 1/7th of time. Probably more like 5% would be more realistic and would allow for higher use by guest plus extra washing etc
    - consumables - could claim some soap, tea , coffee, milk, toilet paper and whatever else is provided. Would need to be fair amount, and probably very little per stay
    - If provide dinner, then could claim portion of cost, ie 1/5th if Airbnb is with family of 4
    - cleaning - fair share of cleaning products
    - depreciation on chattels - 100% from bedroom chattels used exclusively for Airbnb, then probably be at the 5% business use for the other shared chattels similar to power.

    Overall its all amount being reasonable. 25% of your house isn't right if they are only staying 1 day per week!


    Ross
    More Profit from Property? TEACH ME MORE
    Ross Barnett - Coombe Smith Property Accountants
    Proud to give the best property advice for over 13 years.

  9. #9
    Join Date
    Jul 2006
    Location
    North Shore
    Posts
    301

    Default

    How does GST factor into it given that Elliott is running a micro-hotel?

  10. #10
    Join Date
    Oct 2013
    Posts
    1,617

    Default

    Quote Originally Posted by brendan View Post
    How does GST factor into it given that Elliott is running a micro-hotel?
    Probably not at all. Like most micro-businesses, the gross turnover will probably be below $60k, so no GST registration required.
    AAT Accounting Services - Property Specialist Accounting - AATAccounting.co.nz
    Lower fees for investors, traders & real estate agents!
    [email protected] for more information.


 

Thread Information

Users Browsing this Thread

There are currently 1 users browsing this thread. (0 members and 1 guests)

Similar Threads

  1. Replies: 1
    Last Post: 05-09-2017, 03:15 PM
  2. AirBnB Whilst Selling & On the Market
    By FeverPitch in forum Property Investment (NZ)
    Replies: 1
    Last Post: 15-04-2017, 05:26 PM
  3. Tenants made $1568 unlawfully from Airbnb deal
    By Perry in forum Tenant Stuff (NZ)
    Replies: 8
    Last Post: 07-03-2017, 05:49 PM
  4. Taxation Definitions
    By BradFromNZ in forum Finance, legal and tax (NZ)
    Replies: 13
    Last Post: 04-11-2016, 10:20 AM
  5. Tenant subletting rooms via Airbnb
    By james55 in forum Property Management
    Replies: 26
    Last Post: 26-10-2016, 05:11 PM
  6. How do You Know Your Tenant Is Subletting with AirBNB?
    By RoyalRoseProperties in forum Property Investment (USA)
    Replies: 0
    Last Post: 27-02-2015, 02:35 PM
  7. Taxation and legal structures
    By BlueSky in forum Finance, legal and tax (NZ)
    Replies: 6
    Last Post: 25-06-2014, 07:56 PM
  8. Double Taxation
    By Flipper in forum Property Investment (NZ)
    Replies: 10
    Last Post: 06-07-2010, 02:54 PM
  9. taxation issues during renovation
    By The_Dog in forum Finance, legal and tax (NZ)
    Replies: 15
    Last Post: 07-10-2005, 10:08 PM
  10. My Test Results
    By Muppet in forum Forum Funnies
    Replies: 0
    Last Post: 25-06-2005, 12:02 PM

Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts
  •