This is editorial guidance for owners researching the topic. It is not legal or tax advice. Confirm specifics with a chartered accountant familiar with hospitality.
GST applicability
The current GST rule for short-let accommodation in India: stays priced under ₹7,500/night are GST-exempt. Stays at ₹7,500/night or above carry the standard rate. Most premium Airbnb listings cross the threshold; most budget stays don't.
If you cross the ₹20 lakh annual aggregate turnover threshold (across all GST-applicable services, not just hospitality), you're required to register for GST regardless of nightly rate.
How GST collection works in practice
When a guest books your listing, Airbnb or Booking.com collects the gross amount including GST. The OTA then either remits the tax directly (in some cases) or passes the gross to you, and you remit GST and file the GSTR-1 + GSTR-3B against your GSTIN.
If you work with a property management company, they typically handle invoicing under your GSTIN (with the manager listed as billing agent) and reconcile input-tax credit monthly. This keeps the books clean and your CA happy.
TDS — when it applies
Section 194-IB applies for rents above ₹50,000/month — but short-let stays don't typically trigger it because each booking is short and below threshold. TDS is more commonly an issue for corporate-account bookings where the corporate guest deducts TDS at 10% under Section 194-I or 194-IB.
What's deductible
- Property management fees (Rovostays' share, if applicable)
- Cleaning and housekeeping
- Linens, consumables, toiletries
- Furniture and styling refresh costs
- Utility bills (DEWA / electricity / water / Wi-Fi)
- Society maintenance and gatepass fees
- Photography and listing fees
- Insurance premiums
- Property taxes
- Mortgage interest (under House Property income head)
The classification choice
Owners can report short-let income under 'Business' or 'House Property' depending on scale and activity level. Single-property owners typically report under House Property (simpler). Multi-property owners or those running it as a managed business typically report under Business — which allows more expense deductions but requires more complex compliance.
How to keep clean books
- Single bank account for all property income and expenses
- Monthly statements from your management company (if applicable)
- Receipts for every expense — yes, even small ones
- Quarterly review with your CA, not annual
- Tally / Zoho Books / Xero export from your PMS
Most owners who get tax-compliant operations right find the actual tax burden is significantly lower than they feared, because the deduction picture is generous. The hardest part is record-keeping discipline.