How are rental income from a vacation rental treated for tax purposes?
July 13, 2023 | 50,00 EUR | answered by Tatiana Seiler
Dear tax advisor,
my name is Christian Riedmüller and I own a vacation rental that I rent out. So far, I have simply declared the rental income as additional income for tax purposes. However, I have heard that there are special regulations for the taxation of rental income from vacation rentals and I am now somewhat uncertain.
The situation is as follows: I rent out my vacation rental both through platforms like Airbnb and through local rental agencies. The rental income varies depending on the season and occupancy of the apartment. I have not deducted any specific costs for the rental so far, as I am not sure which expenses can be claimed for tax purposes.
My concern is that I may have to pay taxes retrospectively if I have incorrectly declared the rental income. Additionally, I would like to know if there are ways to reduce my tax burden by deducting certain costs from my taxes.
Therefore, my specific question is: How are rental income from a vacation rental treated for tax purposes and what costs can I deduct as a landlord for tax purposes? Are there specific regulations or allowances that I should consider when filing my tax return? Thank you in advance for your help.
Sincerely,
Christian Riedmüller
Dear Mr. Riedmüller,
Thank you for your inquiry regarding the taxation of rental income from holiday apartments. It is understandable that you may feel unsure about the tax regulations, as there are indeed specific rules that landlords must comply with. I am happy to explain to you the tax treatment of rental income from holiday apartments, as well as the options for deducting certain costs from taxes.
In general, rental income from holiday apartments is subject to income tax. It is important to note that as a landlord, you must declare all income from renting out your holiday apartment in your tax return. This includes income from rental platforms such as Airbnb as well as from local rental agencies. The amount of income is calculated based on rental income minus deductible costs.
Deductible costs include maintenance costs, repairs, advertising expenses, management fees, property tax, insurance, and depreciation. Costs for cleaning, maintenance, and upkeep of the holiday apartment can also be claimed for tax purposes. Additionally, expenses related to travel for rental purposes and proportional costs for furnishing the holiday apartment (e.g. furniture, appliances) can be deducted.
It is important that you keep all receipts and invoices for incurred costs in order to provide evidence to the tax office if necessary. Also, note that as a landlord of a holiday apartment, you must comply with VAT obligations if you provide taxable services (e.g. breakfast service, linen rental).
There are no general regulations regarding possible allowances or special rules for the taxation of holiday apartments. However, depending on your individual situation, it may be advisable to consult a tax advisor to examine the tax optimization of your income.
In conclusion, I recommend reviewing your tax returns from previous years and making corrections if you have not claimed certain costs. This can help you avoid potential tax payments and reduce your tax burden.
I hope that this information has been helpful to you. If you have any further questions or require personalized advice, I am at your disposal.
Best regards,
Tatiana Seiler
Tax Advisor
