Does Houfy collect, remit, and file my lodging/TOT/guest occupancy tax?

Carl And Bridget
Jul 31, 2020 . 2 min read

No. Houfy doesn't interfere between guest and host payment transactions. Square and Stripe are integrated with Houfy as online payment options; however, this money never touches Houfy's bank account.

Houfy's integrated payment processors (Square/Stripe) transfer funds directly from the guest's bank, and directly into the owner's bank account. You should receive your guest payments within about two days.

Why do some listing sites collect tax for me?

For the most part, tax collection and remittance by listing sites is because of their voluntary agreements with tax authorities. These are often created as a means of deterring restrictions/bans on short term rentals. In very few cases is a rental platform actually required to collect lodging tax for their hosts.

For example, you sometimes hear hosts complain that only the state tax (or another specific portion) is collected by the site, and they must collect the remaining local county/city taxes separately. This is because the state has agreed for their "portion" to be collected/remitted on behalf of the owner, but the local government has no such agreement.

You may still be required to register and file periodic returns.

When a listing site collects/remits lodging tax on your behalf, they generally do so in one lump sum, with zero identifying host information. And, except in a few cases, you're still required to register yourself for tax purposes.

Be sure to check your local laws to see if your jurisdiction requires individuals to file a return, regardless if a site collects/remits the taxes. For my own return, I report my gross receipts and fill out the "exempt" section to show what has been remitted for me.

Even if a site collects tax on the original reservation, additional taxes may need to be collected later.

Let's say an Airbnb guest books and last minute wants to bring their pet, and you charge a $100 pet fee. If your state requires lodging tax on pet fees (such as North Carolina), then you'll need to do a "change reservation" to ensure it reflects the correct tax amount. The same applies to additional guest fees.

Airbnb will often suggest to collect these fees via the resolution center, especially if the reservation has ended and you no longer have the ability to "alter" it. What the Airbnb rep. doesn't tell you, is you're responsible for collecting the taxes on any/all guest payments made directly to you.

When using their resolution center, be sure to add any applicable taxes to your fee total. Then remit them before the filing deadline. If ever audited, the tax authorities won't accept "it was too late to alter my Airbnb reservation" as an excuse.

It's important to thoroughly understand your local tax laws and what is required to be 100% compliant. Never assume a listing site is handling all of your lodging tax obligations. Be sure you're registered in all applicable jurisdictions, and learn the filing requirements for each one.

If you need any assistance, Avalara is an excellent resource and their site provides a wealth of information. These guys specialize in the collection/remittance of lodging taxes and will be happy to answer any questions, or handle your lodging taxes for you.

Where do I add lodging/TOT/guest occupancy tax?
Click top right arrow to display Drop-down Menu>Manage Listings>Edit>Pricing>Rates & Fees.

Step by Step Guide to Add Your Houfy Listing
Listing your property for FREE on Houfy! - a marketplace where members book and connect directly, and pay no commissions nor booking fees. Here are a few reasons why you should join Houfy: Connect a Stripe or Square account on Houfy and receive payment right after booking. Houfy doesn't hold your $$$.
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