14 Replies Latest reply: May 20, 2019 10:46 AM by dbcondo204 RSS

    VRBO and Taxes

    ashevillelookout Senior Contributor

      QUESTION:  If VRBO wants to collect taxes for a jurisdiction, WHY can't they allow the homeowner to enter the total percentage of tax that must be applied by law for State, County and Municipal taxes, and THEN, BEHIND the scenes,  deduct from the gross collected guest payment the taxes that VRBO has agreed to pay to the state?

       

      Rental Fee:          1000.00

      Cleaning fee:          100.00

      Other Fee (Pet)      100.00

      Total rent and fees     1200.00

       

      State Tax 6%               72.00

      County tax 4%              48.00

      Municipal Tax 3%          36.00

      Total Tax:  13%     1200 x 13%  156.00

       

      Total rent and tax     1356.00

      Service Fee               121.00

      Total Due from GUEST      1477.00

       

      Less Credit Card Fees  3%                      44.31

      Less Service Fee                                   121.00

      Less STATE tax paid by VRBO              72.00

       

      Payable to Owner:                   1239.69

      Owner pays County and Municipal Taxes         84.00  


      Everybody is meeting their tax obligations, and there is NO CONFUSION on the part of the Guest as to what they are paying for.  There are no additional payments being requested by an Owner for taxes that HomeAway did not permit them to collect.


        • Re: VRBO and Taxes
          koko Contributor

          Because that would mean transparency, accountability and competence.

          Let me ponder this one.

          • Re: VRBO and Taxes
            hmmmm Senior Contributor

            No refundable damage deposit?

            • Re: VRBO and Taxes
              stxfarmer Contributor

              That would require a common sense approach to an issue and make it easy for the customers of VRBO. Something that I don't think they are capable of.

               

              Like the issue with Texas, add the 6% that the State requires to their commission for all Texas bookings. The State gets theirs and the homeowner can still set their tax rate which the platform will add to the booking.

               

              But they would much rather address their issue and create a HUGE issue for the homeowner. All they care about is their problem, not ours

              • Re: VRBO and Taxes
                ashevillelookout Senior Contributor

                QUESTION:  If VRBO wants to collect taxes for a jurisdiction, WHY can't they allow the homeowner to enter the total percentage of tax that must be applied by law for State, County and Municipal taxes, and THEN, BEHIND the scenes,  deduct from the gross collected guest payment the taxes that VRBO has agreed to pay to the state?

                 

                I would be very interested in a response from a moderator.

                  • Re: VRBO and Taxes
                    stxfarmer Contributor

                    Here is my post from the other tax thread:

                     

                    Okay will do my best to make sense of what I know now.

                     

                    Had a 30 minute conversation with the City Manager of South Padre Island today and learned a lot about this issue that has not been shared by HA/VRBO.

                     

                    First and foremost the resort cities are all aware of this and paying VERY close attention to this. If not weekly conversations with the platform then every few days. There have been discussions as to what can be done and the current feeling is to try and let HA/VRBO work out the issue but the feeling I got is they are losing their patience just like we are. Got the impression that these discussions have been going on for more than a year

                     

                    One tidbit I learned was that HA/VRBO thought they were close to having the issues solved but they ran into some issues with some of the smaller counties or cities. I am guessing there are some odd tax rates out there and the odd ones are holding everything up for all of us.

                     

                    Overall I feel much better because the city knows so much, much more than we will ever know here on this forum. And they want this solved as they know they are going to take a hit on revenue until it is solved. I would add other tidbits but I don't want to upset the mods or the City Manager if I say too much.

                     

                    It was an interesting conversation is all I will say

                  • Re: VRBO and Taxes
                    ponokai Contributor

                    This tax situation that Vrbo has created is a disaster! Once a quote has been sent out, it is my understanding that no additional money can legally be requested unless the reservation is revised. Telling owners that they are responsible for collecting the GE tax separately is definitely bad business. I'm sure the guest will think something is fishy about this request. For the owners that have been dealing with this issue, do you collect the additional tax through the Vrbo platform or separately outside the platform?

                     

                    My vacation rental is in HI. A new bill, SB1292, was passed and has been sent to the governor who will either veto or approve the bill. I have no problem if the bill is approved because I have paid my TAT & GE taxes all along and I'm in a legal vacation rental location. However, if Vrbo sets up the quote system the same way as they do in Texas, this will be a huge problem for me as well as all other owners.

                     

                    Yes, I agree that more and more states are going to require that vacation rental platforms collect & submit the taxes. Do hotels, timeshares, property managers etc. have to play by the same rules or once again is it just private owners that are subject to the whims of our legislators.

                     

                    Mahalo to all the owners who have been trying to have this major issue fixed. I just hope Vrbo will listen!

                      • Re: VRBO and Taxes
                        lindata Active Contributor

                        It's awful and awkward and they have to come up with a solution stat!!! 

                         

                        I wrote in my "house rules" that they have to read before booking that I have to charge local tax of 1.75% upon booking.  Then I send an additional payment request that says this:

                         

                         

                        Please note, as per reflected in the rules, I will need to send an additional payment request of local Bexar County Hotel tax of 1.75%. We used to have a way to ask for both local and state taxes, but they recently changed the platform so the only way to ask for local tax is after the booking.

                        If you have any questions or concerns, please let me know.  I can also give you the phone number for VRBO if you would like to confirm that they recently changed this for homeowners and that this is, for now, the only way we can collect the local taxes in Texas. 

                        • Re: VRBO and Taxes
                          feibus Senior Contributor

                          You are incorrect in your understanding.  Just DOCUMENT it in your house rules and your listing that you have to collect additional sales tax money that Vrbo isn't collecting as part of the booking.  Then add a payment request to the booking once the guest begins communications concerning the rental agreement and allow the guest to cancel without penalty if they freak out.  And some will freak out, because that's who some people are.

                        • Re: VRBO and Taxes
                          bonesxxx Contributor

                          Great topic - glad I read it.

                           

                          I was under the impression that the taxes were remitted to me (I only have to collect a county tax).

                           

                          If HA is keeping the 5%, then I need to stop charging it.  I just jacked my rates by 5% and pay it myself -- which is what I was doing until I saw the nifty feature to collect taxes... guess I read that one wrong :-(

                          • Re: VRBO and Taxes
                            dbcondo204 Contributor

                            And Texas continues to wait for a fix with no response from VRBO other than we are working on it!