The Tax Administration of Costa Rica has announced in October that Airbnb has been added to the list of service providers overseas that will be automatically charged 13% VAT tax on every booking processed, this means that guests will now be charted the Tax even if the host of the listing hasn’t included it in the rate.

With this change, Airbnb becomes the service #136 in the list of digital services from overseas that is required to pay VAT taxes in Costa Rica.

With this change, Airbnb becomes the service #136 in the list of digital services from overseas that is required to pay VAT taxes in Costa Rica.

1. Automatic collection (non recommended):

The guests can be charged a 13% VAT Tax automatically with the payment of their booking, this makes the tax administration can collect the tax from the source through the payment processors as banks and other platforms, the disadvantage for the home owner is that there could be price differences that might produce claims from the guests, in order to not have any conflicts with guests due price differences, the home owners or hosts should adjust their pricing considering the corresponding taxes in the Airbnb platform and follow the necessary steps to comply with the tax regulation, including registering as a tax payer and filing the corresponding tax returns.

2. Registering as a tax payer (ideal):

The host can add the 13% to the pricing of the their homes, and add the tax to their listings shown in Airbnb, then register as a tax payer and use those 13% taxes on the bookings as a tax credit on the monthly tax returns towards the VAT tax on the income bills throughout the month.

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