GST on Airbnb - Common Mistakes to Watch For
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Articles by Anna Loginova.
Key Takeaways
- Airbnb sometimes wrongly deducts full 15% GST from non-registered hosts instead of the usual 8.5% credit.
- If Airbnb thinks a registered host isn't registered, it can create a GST shortfall IRD may charge penalties on.
- Fix: contact Airbnb promptly to correct GST status and, if needed, adjust the GST return.
- Other Airbnb glitches include the flat-rate credit percentage varying, or applying in one month but not the next.
- These issues follow GST changes for Airbnb-style properties that took effect from 1 April 2024.
You might remember the articles we shared in November 2023 and October 2024, discussing the GST changes for all Airbnb properties effective from 1 April 2024.
As we’ve been working through clients’ 2025 financial statements, we’ve come across a few unexpected issues that are worth highlighting.
When clients start offering their properties for short-term stays and inform platforms like Airbnb whether or not they (or their entities) are GST-registered, the assumption is that this will be accurately recorded in Airbnb’s system. Unfortunately, that’s not always the case, which can have real financial consequences.
Here are two important scenarios we've seen recently:
1. The host is not GST registered, but Airbnb thinks they are
This is a surprisingly easy mistake to make. Perhaps you ticked the wrong box, or maybe Airbnb’s system defaulted to the wrong status.
What does this mean?
Airbnb treats the host as GST registered and doesn't pass on the usual 8.5% flat-rate credit. Instead, they deduct the full 15% GST from your gross income and send it straight to IRD. This means you’re missing out on that 8.5% credit and could experience unnecessary pressure on your cashflow.
What should you do?
If you’re not GST registered and you are not getting the 8.5% flat rate credit, it’s important to contact Airbnb as soon as possible. Ask them to update your GST status and request that they correct the overpaid GST amounts. We’re happy to help you with this process if needed.
2. The host is GST registered, but Airbnb thinks they’re not
This is another common scenario we’ve seen. In this case, Airbnb believes you are not GST registered and pays you the 8.5% flat-rate credit while only paying 7.5% GST to the IRD. As you are actually registered, Airbnb should be paying the full 15% to IRD.
What’s the risk?
This creates a GST shortfall equal to the credit you weren’t entitled to, and IRD may charge interest or penalties on the unpaid amount. It's a situation that could become expensive if left unresolved.
How to fix it
We recommend reaching out to Airbnb immediately to confirm your correct GST registration. They’ll need to update your account. You’ll also need to make a debit adjustment in your GST returns to repay the flat-rate credit you weren’t entitled to.
3. Other inconsistencies by Airbnb
There are a few other points that you should be aware of. For example, we’ve seen these errors that Airbnb have made:
• The percentage flat rate credit is not 8.5% (it could be higher or lower)
• The flat rate is credited in one month but not the next
Keep an eye out, and if you notice any variances like this, contact Airbnb directly to rectify.
GRA can help
These GST issues can be stressful and confusing, but you’re not alone. If any of this is ringing alarm bells, or if you're just not sure whether your GST status is recorded correctly, get in touch with us at GRA (phone +64 9 522 7955 or fill out our online form). We’re here to support you, get things sorted, and make sure you’re not paying more tax than necessary (or risking IRD penalties).
FAQ
What happens if Airbnb has the wrong GST registration status for my property?
If Airbnb thinks you're GST registered when you're not, they'll deduct the full 15% GST instead of passing back the 8.5% flat-rate credit; if it's the other way around, they'll underpay IRD and create a GST shortfall you may need to repay with interest or penalties
How do I fix an incorrect GST status with Airbnb?
Contact Airbnb directly and ask them to update your GST registration status, and request correction of any overpaid or underpaid GST amounts as a result.Is the Airbnb flat-rate credit always exactly 8.5%?
Not always – GRA has seen cases where the percentage credited was higher or lower than 8.5%, or credited in one month and missing the next, so it's worth checking your statements regularly.What should I do if I was wrongly paid the 8.5% flat-rate credit while GST registered?
You'll need a debit adjustment in your GST return to repay the credit you weren't entitled to, on top of getting Airbnb to correct your registration status going forward.
Anna Loginova
Partner
© Gilligan Rowe & Associates LP
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Disclaimer: This article is intended to provide only a summary of the issues associated with the topics covered. It does not purport to be comprehensive nor to provide specific advice. No person should act in reliance on any statement contained within this article without first obtaining specific professional advice. If you require any further information or advice on any matter covered within this article, please contact the author.
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