Taxes of Airbnb in Turkey

In Turkey, all kinds of earnings are subject to tax within the scope of the Income Tax Law. Like any income, earnings earned through the Airbnb application will be subject to tax. However, since the application is relatively new, there are some questions in mind. Airbnb operators are uncertain whether their earnings are capital income, such as house rental, or commercial income, such as hotel management. When examined from a legal perspective, together with the rulings published by the Revenue Administration, it can be said that this income is generally close to commercial income. For comprehensive legal evaluations on Airbnb rentals, you can see our other article ( Airbnb in Turkey: Legal Perspective) .

The criteria set by the Revenue Administration, which evaluates Airbnb rentals as commercial income, are as follows:

1. 1. 1. Generating more income than renting for a long time
      2. Making the real estate available for rental by different people on a continuous basis
      3. It requires an organization to make the house ready again between different people leaving the house and handing over the house to the other person.

Expenses That Airbnb Operators Can Deduct from Income

When evaluated as commercial income, the homeowner has two types of liabilities: income tax and value added tax. Although the taxpayer is liable for VAT due to commercial income, there are some expense items that the taxpayer can deduct from income tax because they are considered commercial income. Expenses that Airbnb operators can deduct from income are as follows:

1. 1. 1. Heating, water and electricity costs, provided that they are used for the guests
      2. Service fee collected by Airbnb application
      3. Expenses for cleaning after the departure of the guests
      4. Maintenance and repair costs of the real estate allocated to Airbnb
      5. Depreciation expenses
      6. Interest/profit rate costs if the allocated real estate is purchased with loan/financing
      7. insurance premiums

The amount of income tax an Airbnb operator will pay varies from year to year. Since the amounts of earnings subject to income tax rates are updated every year, the income tax of the Airbnb operator will also change from year to year. If Airbnb operators do not comply with tax obligations and do not report their income, an irregularity penalty will be imposed in accordance with Article 355 of the Tax Procedure Law.