Business Hotel Room Occupancy Tax

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Hotel room occupancy tax

On May 18, 2021, Mayor Bill de Blasio signed an executive order that eliminated the 5.875% portion of New York City’s hotel room occupancy tax rate for the three-month period from June 1 to August 31, 2021.

As of September 1, 2021, the full hotel room occupancy tax should be collected and remitted.

The hotel room occupancy tax is one of three taxes and one fee that apply to hotel room rentals in New York City. The Department of Finance collects the New York City hotel room occupancy tax, also known as the Hotel Tax. The New York State Department of Taxation and Finance collects:

New York State Sales Tax

New York City Sales Tax

New York State Hotel Unit Fee ($1.50 per unit per day)

Who must pay the hotel room occupancy tax?

The hotel room occupancy tax must be paid on the occupancy, or the right of occupancy, of a room or rooms in a hotel. A "hotel" includes an apartment, hotel, motel, boardinghouse, bed-and-breakfast, bungalow, or club, whether or not meals are served. The occupant of any room or rooms in a hotel must pay the tax. Hotel operators and remarketers (when a room has been purchased through a re-seller) collect the tax from the occupant.

A building is not considered a hotel if rooms are only rented for up to 14 days or are only rented once or twice during any four consecutive tax quarters of a 12-month filing period. Rentals to permanent residents should not be included in the number of rooms counted as hotel room rentals.

Who is exempt from this tax?

A permanent resident (one who occupies a room for at least 180 consecutive days)

New York State, a political subdivision of the State, or a public benefit corporation,

The United States

The United Nations

A not-for-profit organization that was formed and operated exclusively for religious, charitable, or educational purposes, or for the prevention of cruelty to children or animals.

Tax rates

The hotel room occupancy tax is based on the “rent” being charged for a room:

If the rent for the room is…
The tax will be…

$10 or more, but less than $20
50 cents per day per room + the hotel room occupancy tax rate

$20 or more, but less than $30
$1.00 per day per room + the hotel room occupancy tax rate

$30 or more, but less than $40
$1.50 per day per room + the hotel room occupancy tax rate

$40 or more
$2.00 per day per room* + the hotel room occupancy tax rate

* A hotel suite may have more than one room. The tax will be $2.00 per room per day on each of the rooms that make up the suite plus the hotel room occupancy tax for the entire suite rental. (For example; The tax on a suite with 3 rooms will be $6.00 per day plus the hotel room occupancy tax for the entire suite rental).

Filing deadlines

TAX PERIOD
DUE DATE

December 1 to February 28
March 20

March 1 to May 31
June 20

June 1 to August 31
September 20

September 1 to November 30
December 20

March 1 to February 28 (small facility operators only)
March 20

Special filing instructions for periods including June through August 2021

On the quarterly return for the period ending August 31, 2021, enter a zero on line 5 of the return. Annual filers should calculate the additional tax due on line 5 for the period June through August 2021 similarly, i.e., there would include no additional tax due for this three-month period.

Forms

NYC-HTX - Hotel Room Occupancy Tax Return

Hotel Tax - Certificate of Registration Application

Frequently asked questions

I am registered to rent short-term with the Office of Special Enforcement. Do I have to collect the hotel tax?
It depends on the type and frequency of the rental. If you only ever rent just one room to your guest, you are not required to collect the tax. If you rent more than one room to guests, and have either three or more separate rentals in a year or more than 14 total nights rented in a year, you will have to collect the tax.

I plan to rent my apartment through an online booking platform for less than two weeks. Do I have to collect the hotel tax?
You are not required to collect the hotel tax for a single rental of up to 14 days, or two rentals totaling 14 days or fewer. If you rent the apartment through an online booking platform for three occasions during the year (for any number of total days), or on one occasion for more than 14 days, you would be required to collect the hotel tax. Separate from your tax obligation, you will need a short-term rental registration for any rentals for fewer than 30 days. Please refer to the Mayor’s Office of Special Enforcement website.

3. I rent only one bedroom in my house to guests. Do I have to collect the hotel tax?
You do not have to collect the hotel tax if you rent only one bedroom in your house to guests. The rental of only one bedroom in your home to guests is not considered the operation of a hotel but does require a short-term rental registration if you rent for a period under 30 consecutive days.

4. I own a four-family house. I rent out three apartments to tenants under long-term leases. Do I have to collect the hotel tax?
The hotel tax does not apply if you rent to a permanent resident (i.e., a continuous rental for 180 days or more). Therefore, if your “long-term leases” are for 180 consecutive days or more, you do not have to collect the hotel tax.

What are the different exemptions that might exempt me from having to collect the hotel tax?
You do not have to collect the hotel tax if you meet any of the following criteria:

You rent only one room in your own home to guests.

You rent room(s) or an apartment to the same occupant for a period of at least 180 consecutive days.

During a year, you rent an apartment or room(s) for up to 14 days or for fewer than three occasions (regardless of the total number of days). If you rent more than one room or apartment at a single location, those occasions/days will be added together to determine if the totals exceed three occasions or 14 days in a given year.

It is my understanding that I don't have to collect the sales tax on my rentals. Do I have to collect the hotel tax?
Sales tax and Hotel tax are independent from each other. Some people who do not collect sales tax on rentals are confused about the hotel tax for the following reason: Before December 1, 2003, many rentals of "bungalows" for a week or more were not subject to the sales taxes or to the hotel tax. (“Bungalows” are furnished living units, designed for single-family occupancy.) Effective December 1, 2003, that exemption was repealed, but only for the hotel tax. It is still in effect for the sales tax.

Certificate of registration

Every operator of a hotel or small facility and every room remarketer must file a Certificate of Registration application with the Department of Finance and obtain a Certificate of Authority empowering the operator to collect the hotel room occupancy tax. In the case of operators opening new hotels, a Certificate of Registration must be filed within three days after guests begin renting rooms. Within five days of registering, the Finance Department will issue a Certificate of Authority. The Certificate of Authority must be prominently displayed at the place of business. In the case of room remarketers that offer New York City hotel rooms via the internet, scanning the Certificate of Authority and displaying it on the remarketer’s website is considered to be prominently displayed