Renting out via Airbnb, 9flats or Wimdu not explained? Check your voluntary disclosure now!
Renting out via Airbnb, 9flat, Wimdu – Taxable income: Renting out your own flat, whether on a short-term or long-term basis, inevitably results in income from letting. If, after taking deductible costs into account, there is a positive surplus from the income, the income must be declared in your tax return under certain conditions. For some people, this may mean that they become liable to file a tax return for the first time.
However, it appears that not all taxpayers who let out their flats and houses via booking platforms such as Airbnb, 9flats or Wimdu to ensure that landlords fulfil their reporting obligations.
The German tax authorities have therefore now submitted a request for information to Ireland, asking it to forward the data – including the names and addresses of landlords – to the Federal Central Tax Office. From there, the audit material will be forwarded to the relevant local tax offices, which will check whether the income has been declared correctly. This applies to both Rental income from both within the country and abroad.
If any inconsistencies arise in the tax return, landlords must expect to receive enquiries from the tax office, which could even lead to the initiation of criminal tax proceedings.
Practical guidance
Landlords affected should consult their tax adviser to clarify whether they have any rental income and, if necessary, consider making a voluntary disclosure to avoid penalties. In the case of property abroad, particular attention should also be paid to double taxation agreements.
A voluntary disclosure may result in immunity from prosecution if it is complete, i.e. if all undeclared income from recent years is declared and if there are no grounds for exclusion. One such ground for exclusion would be the discovery of the offence. It can be assumed that the offence has been discovered if the tax office already has information about undeclared income. Landlords affected should therefore act quickly!
If you have any questions about declaring rental income from Airbnb, 9flats or Wimdu, or about voluntary disclosure to avoid penalties, we’d be happy to help. Simply Contact us on.