Tourist tax and VAT in your holiday-rental bookkeeping: keep them out of profit

Written by Porchlight Ledger with AI assistance; facts checked against the official sources linked in the text. General bookkeeping information, not tax or accounting advice.

Tourist tax (also called city tax, occupancy tax or a visitor levy) and VAT, if you're registered, pass through your hands. They belong to the municipality or the tax office. If they sit inside your "revenue" column, every profit figure you look at is inflated.

This is general bookkeeping information, not tax advice. Rules differ by country, region and city, and they change. Check with your local authority or an accountant.

Give them their own columns

For each booking, record:

• Gross (what the guest paid for the stay)
• Tourist tax collected (separately)
• VAT included, if you're registered (separately)
• Who collected the tourist tax: you, or the platform

Profit calculations start from gross minus these amounts.

Why a flat percentage is usually wrong for tourist tax

Many places charge tourist tax:

• per taxable guest per night, not as a percentage of the price,
• with exemptions (commonly children under a certain age, sometimes other groups),
• and sometimes with a cap after a set number of nights per stay.

So the right calculation is roughly: taxable guests × nights (up to any cap) × rate per guest per night. Use your municipality's published rules.

When the platform collects it for you

In some locations a platform collects and pays the tourist tax on your behalf. In others it doesn't, and you collect it yourself. This can differ between platforms for the same property. Keep a "collected by platform" marker on each booking. Otherwise you may count tax you never received, or forget tax you owe.

Each platform explains its own arrangements in its host or partner help centre. Check there for your location.

VAT, per property

If you're VAT-registered, the VAT included in your booking price isn't income. Rates and whether short-term accommodation is standard-rated, reduced-rated or exempt depend on the country, and sometimes on the property. Record VAT per property, and include a 0% option for properties or periods where it doesn't apply.

Cross-month stays

If you report tax by month or quarter, split tourist tax and VAT by nights for stays that cross a period end, the same way you split revenue. See our guide on splitting cross-month bookings.

A quick monthly check

1. Total tourist tax you collected yourself, which is what you'll need to pay over.
2. Total collected by platforms, kept for reference so it isn't counted twice.
3. VAT per property.
4. Profit calculated after removing both.

A spreadsheet that handles it

The Holiday Rental Profit Dashboard from Porchlight Ledger works out tourist tax per guest per night with an optional cap, and VAT per property (or 0%), and keeps both out of profit. It covers Airbnb, Booking.com, Vrbo and direct bookings. It's available now at the $14 early-access price (regular $19), emailed to you as an attachment within a few hours: get it here.