Airbnb Business or Rental Income?

Q&A Tax

Question :

Mr. Chan has a holiday investment property at Sydney CBD which is used as an Airbnb business. The
property is rented out as a holiday apartment for the whole year.

Should Mr. Chan put the income from Airbnb rent in the rental schedule or the business schedule in the
his income tax return.


Answer :

If Mr. Chan only has a single residential rental property it is unlikely that this would be a business
activity. It is more likely that this would need to be shown in the rental section of the tax return.

Where the owner of the property is not a company then the ATO provides some recent guidance on
whether rental activities can amount to a business in LCR 2018/7. This LCR is dealing specifically with
the travel deduction changes for rental property owners.

Generally, if Mr. Chan did not have a lot of rental properties (for example, 9 houses) nor actively
supervise the real estate agent or manage majority of issues associated with the properties for many
years, he would not be considered to be carry on a business.

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