Who must collect Hotel Occupancy Taxes?
Every person owning, operating, managing, or controlling any hotel or collecting payment for occupancy in any hotel shall collect the Hotel Occupancy Tax from their guests for the City.
Hotel: Any building or buildings in which the public may, for consideration, obtain sleeping accommodations, including, without limitation: hotels, motels, tourist homes, houses or courts, lodging houses, inns, hostels, rooming houses, short term vacation rentals or other buildings where rooms are furnished for a consideration, but not including: hospitals, sanitariums, or nursing homes.
Consideration: The cost of the room in a hotel only if the room is ordinarily used for sleeping, and not including the cost of any food served or personal services rendered to the occupant of such room not related to the cleaning and readying of such room for occupancy. The room must cost $2 or more each day for the tax to apply. The tax does not apply to charges for meeting rooms or banquet rooms.
Occupancy: The use or possession, or the right to the use or possession, of any room or rooms in a hotel if the room is one which is ordinarily used for sleeping and if the occupant is other than a permanent resident.
Permanent Resident: A permanent resident is defined as any occupant who has or shall have the right to occupancy of any room or rooms in a hotel for at least 30 consecutive days during the calendar year or preceding year. Permanent residents do not have to pay the Hotel Occupancy Tax. In order for the first 30 days of the stay to be exempt from hotel taxes, the hotel must receive written intent that the resident plans to stay at least 30 days. Without written intent, the tax must be collected and remitted to the City and State for the first 30 days of the stay.
What is the City of Austin’s Hotel Occupancy Tax rate?
The City of Austin’s Hotel Occupancy Tax rate is 9 percent. The City Council imposed a 7 percent tax rate under Ordinance No. 900830-L approved on Aug. 30, 1990. An additional tax of 2 percent for venue projects was imposed on Aug. 1, 1998 under Ordinance No. 980709-G. These ordinances have been codified in Austin City Code; Title 11. Taxation; Chapter 11-2. Hotel Occupancy Tax through City Ordinance No. 031204-10, Dec. 4, 2003 and City Ordinance No. 031211-11, Dec. 11, 2003.
Texas law requires that each bill or other receipt for a hotel charge subject to the tax imposed for a venue project contain a statement in a conspicuous location stating: “The City of Austin requires that an additional tax of two percent (2%) be imposed on each hotel charge for the purpose of financing a venue project.”
What is the State’s Hotel Occupancy Tax rate?
As of September 1, 1987, the State’s tax rate is 6 percent. State Hotel Taxes should be remitted separately to the State of Texas. Please visit their website or call 1-800-252-1385.
When are the tax reports due?
Reports are due on the last day of the month following each quarterly period.
|Three months ended||Due date|
|March 31||April 30|
|June 30||July 31|
|Sept. 30||Oct. 31|
|Dec. 31||Jan. 31|
Every person required to collect the Hotel Occupancy Tax must file a report with the City Financial Services Department showing the consideration paid for all room occupancies in the preceding quarter, the amount of the tax collected on such occupancies, and the amount of permanent (30-day) and other exemptions granted.
If the due date falls on a weekend or holiday, the next business day is considered to be the due date. The valid U.S. Postal Service postmark date will be considered the payment date. In addition, because postmark dates may be controlled internally using mailing machines, the City Financial Services Department must receive your report within five business days from the postmark date or the return will be considered delinquent. If a delinquent report is received, a 5 percent penalty will be assessed on the tax due, as per Section 11-2-21 of the Hotel Occupancy Tax Code. On the 60th day past the due date, an additional 5 percent penalty will be assessed on the remaining tax due. Delinquent taxes shall draw interest at the rate of 10 percent per annum beginning on the 61st day from the due date. Delinquent payments are applied to penalties and interest first.
What if I do not owe any taxes?
Even if you have not collected any monies, please enter “0” in the Gross Receipts field and submit the return to the City of Austin Financial Services Department. If you are no longer in business, please note that on the report and return it to Financial Services.
Why do we pay this tax?
The revenue derived from the Hotel Occupancy Tax is used to promote tourism and the convention and hotel industry.
Are there special forms and reporting requirements to remit the tax collected?
Yes. A Report of Hotel Occupancy Tax should be completed in full, signed, and dated. A copy of the concurrent quarterly “Texas Hotel and Motel Tax Report” filed with the State of Texas by the Hotel must be attached to the quarterly report.
How do I obtain a copy of a Hotel Occupancy Tax Report?
The Report of Hotel Occupancy Tax is available on this website. The City of Austin does not accept alternate report forms. All reports must be completed in full, signed, and dated in order to be accepted. If you are unable to print this form, please contact us at 512-974-2590 to request a report by mail or fax.
Why was I assessed a penalty?
If any person fails to file a quarterly report, files a false report, or fails to pay the full amount of the tax due to the City Financial Services Department by the last day of the month following the end of the quarter, a 5 percent penalty will be assessed on the amount of tax due. On the 60th day past the due date, an additional 5 percent penalty will be assessed on the remaining tax due. Delinquent taxes shall draw interest at the rate of 10 percent per annum beginning on the 61st day from the due date. Delinquent payments are applied to penalties and interest first.
What records do I have to keep?
Upon reasonable notice, City of Austin must have access to books and records to enable it to determine the correctness of any report filed and the amount of taxes due. The names, addresses, and identification relied upon in the granting of exemptions to the collection of the tax levied, and any other information the City may reasonably require, shall be accessible for review.
Who is exempt from the hotel occupancy tax?
Hotels and taxpayers should review the State’s online database to determine the exemption status of an organization or entity. In most cases, you will be able to determine if an organization or entity is exempt for City tax purposes in addition to determining State tax exemption status. If you have additional questions, please call the State Tax Assistance Section at 1-800-252-1385.
|Who is exempt?||City exemption||State exemption|
|State of Texas agencies, institutions, boards and commissions and their employees, traveling on official business, except for state college and university personnel and state military personnel (State agencies, institutions, boards and commissions and their employees must pay the local hotel occupancy tax to the hotel and then apply to the City of Austin Financial Services Department for reimbursement).||No||Yes|
|Certain Texas State officials with special hotel tax exemption cards (including heads of state agencies, members of state boards and commissions, judicial officials at the district court level and above, state legislators, and legislative employees.)||Yes||Yes|
|United States government agencies and their employees, including federal military personnel and American Red Cross employees, traveling on official business representing the United States. State military personnel are considered federal military personnel for the purposes of this exemption.||Yes||Yes|
|Diplomatic personnel who present a tax exemption card issued by the United States Department of State.||Yes||Yes|
|Permanent residents – 30 Day Rule*||Yes||Yes|
|Religious, educational, and charitable organizations including college and university personnel traveling on official business.||No||Yes|
|Contractors working for the federal government.||No||No|
|Local Governments and their employees (e.g. City and County personnel).||No||No|
* Permanent resident – any occupant who has the right to use or possess a room in a hotel for at least 30 consecutive days, so long as there is no interruption of payment for the period. A guest who notifies the hotel, upon arrival, of their intentions to stay 30 consecutive days will be exempt from the beginning of their stay. Those guests who do not give the hotel written notice upon arrival that they intend to stay 30 consecutive days, must pay the tax for the first 30 days. Thereafter, they will be exempt.
NOTE: An organization or individual claiming an exemption from the payment of hotel occupancy tax must furnish the hotel with a signed Hotel Occupancy Tax Exemption Certificate at the time of registration.
What are the collection procedures if a hotel is purchased?
If an owner sells his/her hotel, the successor to the seller or the seller’s assignee shall withhold an amount of the purchase price sufficient to pay the amount of tax due until the seller provides a receipt issued by the City Financial Services Department showing that the amount has been paid or a certificate issued by the same department showing that no tax is due.
What if the person(s) purchasing the hotel fails to withhold the tax amount due from the purchase price?
The purchaser of a hotel who fails to withhold an amount of the purchase price as required is liable for the amount of tax required to be withheld to the extent of the value of the purchase price.
How can the purchasers of a hotel obtain a certificate stating that no tax is due?
The purchaser of a hotel may file a written request with the City Financial Services Department for the issuance of a certificate stating that no tax is due or for the issuance of a statement of the amount required to be paid before a certificate may be issue. The City Financial Services Department shall issue the certificate or statement not later than the 60th day after the date the request is received.
What if I disagree with an audit assessment?
If you disagree with an assessment issued as a result of an audit, you must present a written letter summarizing your specific objections within 30 days from receipt of the assessment. You are then allowed 60 days to gather additional evidence to support your stated objections.