Tax Authorities have Collected BGN 4 million from Properties Rented through Airbnb

Over BGN 4 million in income has been declared by owners who provide real estate to accommodate tourists through the Airbnb platform, the National Revenue Agency announced. Income taxation of this activity was introduced in February 2020 - about a month before a state of emergency was declared in Bulgaria due to the pandemic, which effectively put tourism on hold.

It is understood from the announcement that the money was collected after the National Revenue Agency received information from Airbnb and the authorities in Ireland about the properties rented in Bulgaria and started proceedings against the landlords.

The Revenue Agency recalls that short-term real estate provision through online platforms is subject to certain taxes (patent tax, or personal income tax, or corporate tax, or VAT) and social security contributions. This activity is hotel accommodation, and in most cases is defined as commercial in the sense of the Commercial Law and is subject to mandatory VAT registration for the so-called supplies of services for which the tax is due from the recipient, reminded by the Revenue Agency.

This is because landlords use intermediary services on platforms as recipients of a taxable supply of a service that takes place in the country and is provided by a foreign person (online platform) established in another country. In addition, after registration there are obligations to submit monthly VAT returns, respectively sales and purchase diaries.

Through the existing instruments for international cooperation, the NRA has the opportunity to receive through the Irish Tax Administration from Airbnb information about all Bulgarian users who have rented short-term properties in the platform - properties and their addresses and the amount of...