According to the data sent directly by Irish tax authority to the National Tax and Customs Administration of Hungary (NAV) the Hungarian vacation National Tax and Customs Administration of Hungary the Hungarian Airbnb-network received a total HUF 6 billion income from Airbnb rentals in 2015, although tax returns included far lesser sum than that figure.
It is certainly true that times are hard for Airbnb-owners, which may imply changes in the property market.
Only a fraction of the Airbnb-renters pays tax
„For the request of the National Tax and Customs Administration of Hungary (NAV) the Irish tax authority was first in line to send the Hungarian Airbnb data”- explained András Tállai, state secretary responsible for parliamentary and tax affairs.. What this means is that in 215 almost 4,500 Hungarian accommodation providers were related to the Airbnb, who rented out their property 120,000 times generating a total amount of HUF 6 billion yield.
The risk of being caught is high
The secretary of state also concluded that the Tax and Customs Administration of Hungary will compare the data provided by the Irish tax authority against the tax returns handed in by the Airbnb renters and would detect the concealed taxable incomes. Even at the first cross-checks of data, an Airbnb renter was caught, who had had HUF 17 million yields in 2015, although the person had declared only the one tenth of it.
Last chance for non-taxing Airbnb-owners
It is worth paying the tax for the accommodation providers who has not paid the tax yet, since the tax authority has information of the income of 4,500 accommodation providers. András Tállai informed the Hungarian media that he had asked his colleagues not to apply strict sanctions at once if it is possible but to help those whose tax returns were different from the data of the Irish tax authority.
It is not worth renting a place on Airbnb off the books
There is a reason for the fact that 24.hu, a Hungarian news portal has recently written about the dusk of the Airbnb-business as it seems that more and more people stops it because it has not lived up to their expectations. Zoltán Schneider, head of downtown office of the Balla Ingatlan property firm said:
”The experience proves that many of the investors’ expectations weren’t justified: their properties have been entirely worn out by the tourists, it hasn’t generated significant yields, and they have realized that it requires too much effort.”
Worrying information has recently emerged concerning the short term rents. It was found that several condos took actions against apartment owners who rented out their apartment for Airbnb purposes. Another news magazine reported about the end of the Airbnb-fever in the capital: ”Since September the Airbnb-fever seems to have ended due to the full market, hence short term rentals are not more worthwhile than long terms.”
It appears from the situation that Airbnb short rental isn’t an ideal case for doing it under the counter, not least because almost all transactions of the world's largest accommodation provider can be carried out only through banks.
It is thus worth consulting an experienced real estate office with qualified tax experts and accountants who can professionally carry out the whole process in a thorough and effective manner.