Disclaimer: This blog is intended as a general guide and may not cover all specific situations or reflect the latest legislative changes. For personalised advice that considers your unique circumstances, please consult a qualified tax professional.
New GST Rules for Short-Stay Accommodation: What Hosts Need to Know
As of 1 April 2024, the GST rules for short-stay accommodation have changed to create a fairer market against other accommodation providers who must register for GST under the standard $60,000 threshold.
If you use platforms like Airbnb or Bookabach, it’s important to understand these changes to protect your income and stay compliant. Here’s a practical breakdown of what’s new and what you need to do.
Key Changes in a Nutshell
- Platforms like Airbnb and Bookabach now collect and pay GST to Inland Revenue, even if you’re not GST-registered.
- Non-registered hosts will receive an 8.5% credit from the platform to reduce the GST impact.
How Does This Affect Your Income?
If you’re not GST-registered and don’t adjust your prices, your income per booking will decrease by 6.5%.
Example Calculation:
- Guest pays: $230
- Airbnb remits: $13 GST to Inland Revenue (Base Amount – 15% GST + 8.5% flat rate credit)
- You receive: $217 ($230 – $30 + $17)
In short, you’ll lose $13 per booking unless you increase your prices to account for this change.
What If You’re Already GST-Registered?
If you are already GST-registered under the standard conditions of the $60,000 threshold:
- Inform the platforms you use (e.g., Airbnb or Bookabach) that you are GST-registered.
- This ensures they do not apply the flat-rate 8.5% credit and zero-rate any amounts received from them, as GST would already have been deducted at source.
- You can continue to claim related expenses and will likely receive a monthly refund if your income is primarily sourced from these platforms.
By understanding these changes and acting early, you can minimise financial impacts and keep your short-stay rental business on track. If you’re unsure how these rules apply to you, consult a tax professional for tailored advice.