Properties operating as a Hotel must charge the Hotel Tax on the price of the room paid by the guest. Effective July 1, 2015
The term "Hotel" includes an apartment, hotel, motel, inn, guest house, bed and breakfast or other building (including personal residences) located within the City which is available to rent for overnight lodging or use of facility space to persons seeking temporary accommodations. This tax is imposed on the rental of a hotel room to accommodate paying guests.
The Hotel Tax is filed and paid monthly for the prior month's activity.
The City of Philadelphia has recently enacted legislation to outline where and how properties (including individual residences) may be rented out to visitors on a short-term basis (less than 31 nights in a row).
This change adds a definition for Booking Agents that facilitate room rentals (ex. AirBnB or FlipKey) and allows them to collect and remit Hotel Tax on operator’s behalf. Booking Agents that do not collect and remit will have quarterly reporting requirements. All booking agents must alert operators of the Philadelphia tax and permitting obligations.
Obligations for Short Term Rentals in Residential Properties:
- The City of Philadelphia Hotel Tax of 8.5% on amount received by the host/operator must be paid monthly.
- Net income must be reported on the School Income Tax (for individuals) or Business Income & Receipts Tax and Net Profits Tax (for businesses) annually by April 15th for the prior year.
- Anyone can rent a residential property for short-term stays for up to 90 nights per year.
- Philadelphians can rent all or part of their primary residence for more than 90 nights a year after getting a Use Registration Permit from the City and agreeing to abide by certain standards, relating to things like trash and recycling, noise, fire safety and other rules to ensure a safe and pleasant stay for guests and neighbors. More information about the Use Registration Permit and standards are available at www.phila.gov/li.
- Properties that are not a primary residence and are rented for more than 90 nights per year require a rental license and a use registration permit for “visitor accommodations.”
Who Must File
The hotel operator is responsible for the filing and remittance of the tax. It is the hotel's responsibility to collect the tax from the guests paying for the room.
For commercial establishments, the Department of Revenue issues a "Monthly Hotel Tax Coupon Book" to simplify tax payment. Coupons can also be printed from Revenue's website.
Residential properties using a booking agent may allow the booking agent to collect and remit the tax. Hotel Tax from residential properties that are not collected and remitted by a booking agent must be filed and paid online at https://secure.phila.gov/Revenue/HotelTax/Home.aspx.