Whether your a Property Manager or Homeowner, its critically important to understand how to calculate your net rental income. Most online listing services, such as Airbnb and Homeaway, offer tools to view and export your rental income data. However, there are fundamental differences between these hosting channels in the way this data is calculated.
Airbnb offers a simplified approach to reporting. On your property listing page you simply set a rate (dynamic or fixed) and define flat fees for extra services such as cleaning, deposits and additional guests. Unfortunately Airbnb doesn’t offer a way to charge hotel tax to guests, so you must build it into your rates. Aibnb charges a hosting fee (generally 3% of all payments received) to the host and lumps the remaining payout into one sum. So the “amount” column for each reservation includes the rent, host fee, and additional charges to the guest. Airbnb does not charge a payment processing fee. If you are reporting your rental income to local tax authorities, you simply subtract your expenses and fees from the “amount” to get your taxable income. See the generated sample from Airbnb below.
|Date||Type||Confirmation Code||Start Date||Nights||Guest||Listing||Details||Reference||Currency||Amount||Paid Out||Host Fee||Cleaning Fee|
|Reservation||XXXXXX||4.00||John Doe||My Listing||USD||433.00||13.00||50.00|
So, in the above example the taxable income is $383 (amount minus cleaning). Simple and straightforward. Now, lets look at Homeaway’s payment data.
|Reservation ID||Check In||Check Out||Number of Nights||Source||Payment Date||Disbursement Date||Payment Type||Property ID||Guest Name||Payment Method||Taxable Revenue||Non-Taxable Revenue||Tax||Service Fee||Currency||Guest Payment||Your Revenue||Commission||VAT on Commission||Payment Processing Fee||Refundable deposit||Payable To You||Payout|
|HA-XXXXXX||01/08/2017||01/12/2017||4.00||HomeAway.com||01/19/2017||01/09/2017||Refund||XXXXXXX||John Doe||Credit Card||$0.00||$0.00||$0.00||$0.00||USD||-$250.00||-$250.00||$0.00||$7.50||$250.00||-$242.50||-$242.50|
|HA-XXXXXX||01/08/2017||01/12/2017||4.00||HomeAway.com||01/05/2017||01/09/2017||Rent||XXXXXXX||John Doe||Credit Card||$406.60||$345.00||$64.20||$47.52||USD||$889.72||$842.20||-$26.40||$0.00||-$25.27||$250.00||$790.53||$790.53|
There are 24 columns in the generated payment report from Homeaway. As you can see, there is a lot of data to process. The main thing you need to understand about the difference between Airbnb and Homeaway is that the latter does not include the payment processing fee in the commission amount. So, you are actually losing an additional 3% in all payment collections, even taxes. The other source of confusion in Homeaway’s report is that they have two subscription models (pay-per-booking or annual contract) and include irrelevent information such as traveler fees and VAT. Like Airbnb, Homeaway charges a commission (5% for pay-per-booking) on rent, cleaning fees, and any other charges to the guest, except taxes. If you are reporting hotel taxes you only need to pay attention to the “taxable income” column, which is the rent total minus commission and does not include any other guest payments. The “non-taxable” income column is the sum of the refundable deposit and other charges minus the commission amount. Homeaway sees the refundable deposit as income until the amount is refunded along with the payment processing fee.
You can read more about Homeaway’s booking fees here, buried deep in their support documents.