Tax revenue remittance in Puerto Rico

[Rob-And-Heather0]

So, I hoping to start a conversation about Airbnb's tax remittance (or lack thereof) in Puerto Rico (and maybe other municipalities and regions). We started renting a house in Dorado, PR in June 2020 and obtained a hotel tax ID number from the PR Tourism Company. I entered that info into our listing. After a few months of rentals (and filing tax reports with the authority) I became suspicious about how often or even IF they actually submit tax revenue to the PR Govt. In addition, there is no way to check and make sure that Airbnb has our correct ID number. Finally, I did get a reply from someone at Airbnb who indicated an incorrect tax number for us (not sure where they got the number from) and also that they only remit tax revenue once a year. Through the app or website there is no way for an owner to review or change the tax ID number associated with the listing, which is completely ridiculous. I can't get them to change it or respond. Has anyone actually been able to verify that Airbnb is remitting tax revenue? And, is the revenue being properly credited to your hotel ID number? Thanks for your help.

[George641]

I don't really get your point base on what you need to do disregarding what does the big corporation or Airbnb does. Base on my knowledge I am just like you or even worst. Lost and frustrated and thousands of dollars on losses and rents waiting for their permission to operate. The personal liability for you as a host is way bigger than Airbnb's as a digital service platform. You are liable to be fined for each day you book without complying, also liable for not remitting the "tax" or doing it late according to the "law" created. All BS I know. The way the state does this is weird and bogus collections, you are 100% on that. My biggest complaint is the way they tax. Is not clear and if it is the way I think it is, it's evil. Airbnb remits the 7% that's collected automatically. It is all is required per reservation including other fees. Now, the hotelier number goes around older businesses. This was made for the word of mouth or in-person and cash transactions back in the day and not so popular or convenient anymore. So, if Airbnb collects and remits 7% why do I have to notify the "room tax division" a very annoying monthly report of my transactions if Airbnb already collected the taxes? Are they going to tax me as well on top of the 7% that Airbnb just collected? Is that a mandatory hidden "double taxation"?  - let's call it triple "taxation" ! because also by the end of the tax year period, the IRS will tax me again right? What about if you are running the Airbnb listing not as a person but as an LLC? Does the same apply? Do you get it? Airbnb does not care about your "responsibility" as a person doing business in any territory. They also have a clear disclaimer about taxes and local laws saying basically it's all on YOU, yes you "the host" to comply with what applies to you. Airbnb is a system created with a multinational company and they are abiding the law with the state. They do not worry about an individual's hotelier number as much as the government does or as much as you should do. The law has been changed under the recent executive order created by Governor Wanda Vazques Garced is all-in against -"tourism" - "tourist"- guests and hosts. All with the excuse of flattening the curve. They even celebrated their strict traveling requirements managing to decrease tourism by 25%. The hotelier number is not for Airbnb to match your profile, is for the government to force you to give up sensitive personal information about you and what you do with your property. Easy money for them. Was made legal for them to collect taxes and to make sure Airbnb community members and hosts will be tracked and raided whenever they are in order to force you to comply with whatever new requirements they come up with. Is that simple! That includes new "OSHA" regulation plans and now you can be fined or permanently shut down if you don't have the OSHA plan. "executive order" again. The hotelier number also tells other government agencies if your property was "a main exonerated property = taxless" That way they can turn it into an "income property" = "tax-burden" in their database and will allow them to start taxing the property owner as well. Any little money you make they will eventually get it back from you with no effort. That is part of the "hotelier's number purpose" The recipe is how you can strive with all of these evil obstacles and extortion in the way. The answer is: It is not easy.  

[Carol8918]

I 100% agree with you on everything. I think Puerto Rico loves to make things complicated for us to give them an information that airbnb already gives them reports on. We all have to go through  hoops and loops for anything that has to do with filing information for them. Sadly it's always been like that, they need more organization and make things simpler.

[Peter4169]

I agree Puerto Rico is quite off track, and Airbnb is also very off track. Unfortunately Airbnb has somewhat of a monopoly in PR. Even in the US, it’s basically a duopoly of Airbnb and VRBO, so neither company has much incentive to improve their operations or their customer service. Homeaway used to have really good customer service reps via phone and email. But then VRBO bought them and got rid of Homeaway in order to eliminate a major competitor. VRBO’s customer service support is also bad, but not as bad as Airbnb’s. VRBO’s is about a 2.5 out of 10 while Airbnb’s is about 1 out of 10. 

[George641]

I haven't talked about Insurance in Puerto Rico regarding household liability. The insurance fees start around $2,000 USD to cover you from been sued. This is in addition to the basic mandatory yearly insurance. Most if not all Insurance companies consider Airbnb a high-risk business considering the number of traffic Airbnb properties receive and the possibility of them having to pay for legal fees representing their clients especially overseas when guests are travelers. Insurance companies came up with their own game to extort landlords doing Airbnb. Adding up the mortgage or rent, utility bills, maintenance, losses, and damages caused by guests. The only cheapest way around it is to create an LLC to limit the liability of personal non-related assets. In the case of any legal action against the host, only the LLC will be affected but without insurance, the veil could be pierced based on corporate negligence. Again, governments and other complementary services and businesses are making Airbnb less attractive, less profitable, and more difficult to operate.   

[Peter4169]

I’ve been having the same problems with Airbnb.  I don’t know if Airbnb is actually sending the tax payments they’ve collected in the past 6 months for my rental to the government of PR. Airbnb won’t give me a verification or confirmation of it. 

I have 3 different government-related IDs for my condo that were given by different departments of the government. When I first started renting out my condo, Airbnb asked for a PR government ID number for my rental, and I mistakenly gave them the wrong one because it wasn’t clear which ID number they wanted. But there is no place on the Airbnb site to either update my ID, or even see which ID they are currently using. When I call and write to Airbnb support, they refuse to tell me which ID they have for my rental. 

Thus I have no idea if: A) Airbnb still has the wrong ID, in which case my tax payments probably aren’t being credited to my account ... or  B) if somehow their system figured out the problem and located the right ID in the PR government’s system. I doubt this given that the PR system is ancient and chaotic. In fact I’ve emailed the Compania de Turismo email address three times trying to find out if they’ve received payments from Airbnb for my rental, and never received a reply. I’ve also called one of their numbers a few times, and put on hold for over an hour and had to hang up to do other things. Another number goes to a voicemail and I’ve left 3 voicemails and never received a call back. 

The CSV reports that I can generate on Airbnb.com show that they’ve collected the taxes, but I don’t know if they’re sending them to my account with the Compania de Turismo. Multiple attempts to get verification or to find out what ID number they’re now using for me have been a giant waste of time and frustrating. The majority of the Airbnb customer service reps usually don’t listen to what I’ve said, and give replies that don’t relate at all to my questions or my problem. It’s often pointless to contact them about anything.

Even the small percent of times my situation is taken care of, it often takes about triple the amount of time that it should take. Besides losing time by doing it, the fees I’m paying Airbnb for each rental are generally being wasted on the customer service people. If half of them actually did their jobs even moderately well, the fees I’m charged and that guests are charged could be lower.