We have just received a letter from Urssaf following verifications on our gites income for 2021 fiscal year.
We have always declared our actual income ie. the amount we earn, not including Airbnb and Booking.com commissions.
This seems logical, as that is THEIR income to pay tax and cotisations on, not ours.
But the letter says that we should have declared these commissions and have raised our CA for the year by 3 700€ and are claiming 246€ in unpaid cotisations on this amount.
Presumably, they will then proceed to do the same on the following years…
Can anyone explain to me how this rule can be correct? That we should pay social charges on another companies’ earnings, money that we have never benefitted from as it has never been paid to us (it is deducted by the relevant platform before paying us our net income)???
I cannot get my head around how that is not fraud at worst or double taxation at best…
The commissions are literally how the platforms earn their money, it is not ours !
Perhaps might help to think of it in another way. Our equivalent is that we pay commissions out of our turnover, so we declare the whole turnover and pay on that basis. The fact that it doesn’t touch your bank account is perhaps irrelevant?
Not really much different from any other fees and charges you pay out?
Sorry, not clear! We don’t use Air or Booking but pay commission/fees to two small portals and our tourist office if they make reservations. So roughly the same sort of thing.
Anyway we pay these fees/charges out of the income we get. And of course would pay tax and social charges on the total income, not on the income less these fees/charges.
We benefit from a 71% fiscal abattement (in 2024, it will be less according to the new rules in 2025) because the premise is that we don’t pay tax and charges on total income but minus this theoretical allocation for our costs. “Normal” businesses have tax deductibility on their real fees and charges.
And Airbnb and Booking.com are also presumably paying tax and charges on their earnings - so how is the government not taking it twice ? Earning money from both parties for the same income - that can’t be right?
My understanding, and as a lawyer I should say this is not legal, or accounting, advice, is that people are keener on airbnb in this respect because the customer fee is separate, it’s a fee for them, so doesn’t necessarily get included in the revenue, you declare room price plus your host fee whereas booking has a top rate for the customer, then you, rather than the customer, pays them commission, so the whole sum is declared. I’m not sure if the airbnb way has been tested in court, but it’s certainly what I’ve seen around on the interwebs so it’s definitely what some do.
I see what you mean. We are regime réel so rather different.
Were we using normal micro-bic but did not use Air or Booking we would be a tiny bit penalised.
So say I have a booking for €500 and have to pay commission of €50 from this. So declare the full €500 then would pay tax on 145. Say at 20% this is €29. So I end up with €500 -50 - 29 = €421.00
But if Air takes €50 commission separately then you would declare €450 and then only pay tax on €130. Which is €25. So you end up with €450 -€25 =€425.00
Do you are not really losing out, but basically you are right it doesn’t make sense!
No, the government is saying we have to pay tax and cotisations on the full 500€ in your theoretical example (including 15% + VAT that goes to Airbnb as host service fee)
I haven’t been a landlord in France but the countries I have you need to report the full amount pre fees. If you rent a place for a 100 a day it doesn’t matter if you pay fees or not you report a 100 on taxes. I think from what I’ve read you should be able to report the fees as an expense and not pay taxes on it.
All ME businesses pay cotisations and declare the gross amount of their income, no deductions should be made for any business expenses- these are covered by the automatic 71 (now 50) % abatement.
The fees charged by Air, Booking, Verbo and the like are business expenses so should not be deducted from your gross income.
I know it can seem confusing as it doesn’t actually get paid into your bank account, but it helps if you imagine the total amount being paid to you, then you immediately paying their bill.
I’m sorry- there is nothing you can do but pay up, you will know for next time!
I suppose the way to look at it is that this is a marketing/advertising/promotion expense, which is an overhead that virtually all businesses have, and as such is one of the items that will have been taken into account in calculating the “built in” allowance for business overheads and expenses. Otherwise on the ME scheme someone who got all their bookings via online platforms would be be both deducting marketing costs from declared turnover and at the same time benefiting from the inbuilt expenses allowance designed to compensate for those costs. Which would give them a significant advantage over a competitor who does all their own marketing and pays for it out of their declared turnover. Although I do not suppose there are many these days who do not use the online platforms.
As to the argument that it is the platform’s income so they should be taxed on it not you, I do not think that holds water because on the ME scheme the same applies to most if not all business expenses. If you pay a service provider to design you a website and a media campaign, then on ME you pay your tax and cotisations on that money as part of your turnover and the service provider pays their own tax and cotisations on it. If you pay a plumber to install a new ensuite in a guest room you pay the plumber out of your turnover that you have paid tax and cotisations on, and he pays tax and cotisations on it as part of his income.