Airbnb and short-stay rental income is taxable in New Zealand — IRD is clear on this and receives data from platforms including Airbnb. Whether you rent out a spare room occasionally or operate a full holiday home, you have tax obligations. The tricky part is the mixed-use rules that apply when you also use the property personally.
All Airbnb and short-stay rental income is taxable. If the property is used for both personal use and short-stay rental, mixed-use asset rules apply — you can only deduct expenses proportional to rental use, and the calculation uses a specific formula. If rental income from short-stay activity exceeds $60,000 in a 12-month period, you must register for GST. File all short-stay income on your IR3.
Is Airbnb Income Taxable in NZ?
Yes — definitively. IRD treats short-stay rental income the same as any other rental income. It is taxable at your marginal income tax rate.
Important: Airbnb and similar platforms (Bookabach, Vrbo, Booking.com) share host income data with IRD. IRD has specifically targeted short-stay rental income as an area of non-compliance. Do not assume that because it is a digital platform, IRD does not know about it.
Renting a Room in Your Home
If you occasionally rent a spare bedroom in your own home:
- The income is taxable
- You can deduct a proportion of home expenses (by floor area)
- If the room is rented for less than 62 days in the year, you may be eligible to use IRD’s standard-cost method — a simplified flat-rate deduction per room per night
Standard-cost method rates (approximate 2025–26 values):
- Short-stay (less than 4 consecutive weeks): up to $55/night per room
- Long-stay (4 weeks or more): set amounts per week
Using the standard-cost method means you deduct a flat amount rather than tracking actual expenses — simpler, but may not be optimal if your actual costs are higher.
Mixed-Use Holiday Home Rules
If you have a property that you:
- Rent out short-stay (Airbnb), AND
- Use yourself for holidays/personal use
…then the mixed-use asset rules apply. These rules use a specific formula to apportion expenses.
The Formula
Deductible expenses = (Rental days / (Rental days + Personal use days)) × Total expenses
Days the property sits empty (neither rented nor personally used) are excluded from the denominator — this is the key difference from the general proportional calculation.
Example:
Rental days: 60
Personal use days: 30
Empty days: 275
Total days: 365
Rental proportion: 60 / (60 + 30) = 66.7%
If total annual expenses (interest, rates, insurance, etc.) = $30,000
Deductible: 66.7% × $30,000 = $20,000
Note: This formula produces a higher deduction than simply using 60/365 (16.4%) because empty days are excluded.
No Loss Offset
Under the mixed-use asset rules, if rental expenses exceed rental income, the loss is ring-fenced — it can only be carried forward to offset future rental income from the same property. It cannot offset wages or other income.
GST on Short-Stay Rentals
Unlike long-term residential rental (which is GST-exempt), short-stay accommodation is a taxable supply for GST purposes.
GST registration threshold: If your total short-stay rental income exceeds $60,000 in any 12-month period, you must register for GST and charge 15% on top of your rental price.
If you register:
- Add 15% GST to guest charges (the platform may handle this)
- File regular GST returns and pay IRD the net GST collected minus GST on expenses
- Claim GST back on property-related expenses (proportional to rental use)
If your income is under $60,000, registration is voluntary. For small operators, it is usually not worth the compliance burden.
Airbnb’s GST handling: Airbnb NZ charges and remits GST on its service fees. Depending on your agreement with Airbnb, it may also collect and remit GST on guest payments on your behalf — check your Airbnb host settings and consult IRD’s guidance on marketplace platforms.
Expenses You Can Claim
For the rental portion of use, you can claim:
- Mortgage interest (proportional to rental days under mixed-use formula)
- Council rates (proportional)
- Insurance (proportional)
- Cleaning costs (100% if cleaning is done only for rental stays)
- Platform fees — Airbnb service fees (100% rental-related)
- Linen and consumables used by guests (100%)
- Repairs to damage caused by guests (100%)
- Depreciation on furnishings (proportional)
- Property management costs specific to rental
Filing Airbnb Income
Include all Airbnb/short-stay income on your IR3 in the rental income section:
- Enter gross rental income received
- Enter allowable deductions (calculated using the mixed-use formula if applicable)
- Net rental income is added to your other income and taxed at your marginal rate
Airbnb provides a host income summary in your account — use this to verify total income received for the tax year.
Frequently Asked Questions
Do I need to tell IRD about my Airbnb income?
Yes. All rental income is taxable and must be declared. IRD receives data from platforms and has run campaigns targeting undisclosed short-stay rental income. Failure to declare can result in back taxes, penalties, and interest.
Does the bright-line test apply if I sell my Airbnb property?
If the property was not your main home (or was used for income-earning most of the time), the bright-line test may apply if you sell within 2 years of purchase. See our Bright-Line Property Tax Rule guide.
I only rented my bach 10 nights last summer. Do I still need to declare it?
Yes — all rental income is taxable regardless of how few nights. However, at very low income levels, the tax may be minimal. Use the standard-cost method if eligible to simplify the calculation.
What platform fees does Airbnb charge, and are they deductible?
Airbnb typically charges hosts a service fee of around 3% of the booking subtotal. This is 100% deductible as a cost of earning rental income. Get a summary from Airbnb’s host dashboard showing fees charged during the tax year.