Frustrated with VRBO fees

Short-Term & Vacation Rental Discussions
3yFollow

Frustrated with VRBO fees

Patricia Andriolo-Bull
Member since 2022 · 527 posts · 413 votes

Hello.  Today, VRBO started collecting all taxes for my area (Collier County, FL which is 12% in total).  I received a booking and see that they are taking their fee off of the entire booking including taxes (for reference, even airbnb does not do this.  They have been always collecting my taxes).  I also pay the annual subscription for VRBO given that most of my business comes from VRBO.  Have others seen this?  This doesn't feel right to charge commission on a regulatory requirement.  I'd prefer to collect and pay my own taxes as I used to but not sure if that is even an option.

0Reply
71 views

Most Popular Reply

Leslie Anne Morris
Real Estate Agent · Smoky Mountains, TN · Member since 2022 · 1k+ posts · 984 votes
3y

I integrated with Ownerrez and now I process all payments outside of VRBO. Game changer. 

3Reply
See this reply in the discussion

21 Replies

Jump to latestLatest
  • Dave StokleyBusiness Member
    Property Manager · Cleveland, OH · Member since 2015 · 699 posts · 799 votes
    3y

    I mean they are collecting and remitting the tax for you, so there's value in that.

    1Reply
  • Carolyn Fuller
    Cambridge, MA · Member since 2015 · 651 posts · 736 votes
    3y

    I became frustrated with VRBO's fees and their tax collection SNAFUs a couple of years ago. I no longer have an annual subscription and mostly just list on Airbnb. I haven't had a VRBO booking since 2018. This is after years of just listing on VRBO. 

    I have always found Airbnb's fees to be much more transparent and predictable.

    0Reply
  • John UnderwoodPro Member
    Investor · Greer, SC · Member since 2014 · 13k+ posts · 17k+ votes
    3y
    Quote from @Dave Stokley:

    I mean they are collecting and remitting the tax for you, so there's value in that.


     Absolutely!

    Airbnb doesn't collect all the taxes for me, Vrbo does.

    0Reply
  • John UnderwoodPro Member
    Investor · Greer, SC · Member since 2014 · 13k+ posts · 17k+ votes
    3y
    Quote from @John Underwood:
    Quote from @Dave Stokley:

    I mean they are collecting and remitting the tax for you, so there's value in that.


     Absolutely!

    Airbnb doesn't collect all the taxes for me, Vrbo does.

    Luckily almost all my bookings come from Vrbo.
    0Reply
  • Carolyn Fuller
    Cambridge, MA · Member since 2015 · 651 posts · 736 votes
    3y
    Quote from @Dave Stokley:

    I mean they are collecting and remitting the tax for you, so there's value in that.

    Airbnb collects and remits my state and local occupancy taxes, as well. The base Airbnb uses to calculate the 3% service fee they charge me does not include those taxes. The base used by Airbnb host is just what the host charges the guest (e.g., rental & cleaning fees).

    My state regulations dictates that the STR platform collects and remits the state and local occupancy taxes which is why I don't have the option to collect & remit them myself. I suspect this is the case across the country.

    One of the things that drove me crazy about dealing with VRBO was the fact that I could not predict what their fees would be and the fact that these fees were on top of the annual subscription I was paying. I realize that the problem was that they used 3rd party vendors for their payment processing. 

    1Reply
  • Patricia Andriolo-Bull
    OP
    Member since 2022 · 527 posts · 413 votes
    3y
    Quote from @Carolyn Fuller:
    Quote from @Dave Stokley:

    I mean they are collecting and remitting the tax for you, so there's value in that.

    This is my issue  and while I understand there is value in them collecting and remitting the fees, I was doing it myself and took me no more than 5 minutes monthly.  Calculating the value of my time, this does equate to value from VRBO for me, especially given they do so in bulk.  Also, as I stated, Airbnb does the same for me and charges no fee on taxes which makes sense.  The effective rate on VRBO is now 3.46% on top of the annual subscription fee.  I have Airbnb and a direct booking site but unfortunately my market is predominantly VRBO  

    Airbnb collects and remits my state and local occupancy taxes, as well. The base Airbnb uses to calculate the 3% service fee they charge me does not include those taxes. The base used by Airbnb host is just what the host charges the guest (e.g., rental & cleaning fees).

    My state regulations dictates that the STR platform collects and remits the state and local occupancy taxes which is why I don't have the option to collect & remit them myself. I suspect this is the case across the country.

    One of the things that drove me crazy about dealing with VRBO was the fact that I could not predict what their fees would be and the fact that these fees were on top of the annual subscription I was paying. I realize that the problem was that they used 3rd party vendors for their payment processing. 


    0Reply
  • Ryan MoyerBusiness Member
    Property Manager · Orlando Kissimmee Davenport Salt Lake City, Park City · Member since 2019 · 991 posts · 1k+ votes
    3y
    Quote from @Dave Stokley:

    I mean they are collecting and remitting the tax for you, so there's value in that.


    It's not like they give you an option so they shouldn't be charging on it, nor does their competition.

    This would be like a PM taking their commission out of the total guest booking including taxes, which would be ridiculous.

    Cosmic Vacations4.9172 Reviews
    WebsiteView Page
    0Reply
  • Leslie Anne Morris
    Real Estate Agent · Smoky Mountains, TN · Member since 2022 · 1k+ posts · 984 votes
    3y

    I integrated with Ownerrez and now I process all payments outside of VRBO. Game changer. 

    3Reply
  • Ken Boone
    Investor · Greenville, SC · Member since 2015 · 1k+ posts · 1k+ votes
    3y
    Quote from @Ryan Moyer:
    Quote from @Dave Stokley:

    I mean they are collecting and remitting the tax for you, so there's value in that.


    It's not like they give you an option so they shouldn't be charging on it, nor does their competition.

    This would be like a PM taking their commission out of the total guest booking including taxes, which would be ridiculous.


     Correct me if I am wrong.  I was under the impression that that service fee is to cover the credit card processing.  If that is the case, the credit card processing would be on the full amount, which would include the taxes, which if that where the case then it would make sense.  I might be wrong about that though.

    0Reply
  • Patricia Andriolo-Bull
    OP
    Member since 2022 · 527 posts · 413 votes
    3y
    Quote from @Leslie Anne Morris:

    I integrated with Ownerrez and now I process all payments outside of VRBO. Game changer. 


     I was thinking of this but on VRBOs website it states it still charges a commission.  Is that not accurate?

    0Reply
  • Patricia Andriolo-Bull
    OP
    Member since 2022 · 527 posts · 413 votes
    3y
    Quote from @Ken Boone:
    Quote from @Ryan Moyer:
    Quote from @Dave Stokley:

    I mean they are collecting and remitting the tax for you, so there's value in that.


    It's not like they give you an option so they shouldn't be charging on it, nor does their competition.

    This would be like a PM taking their commission out of the total guest booking including taxes, which would be ridiculous.


     Correct me if I am wrong.  I was under the impression that that service fee is to cover the credit card processing.  If that is the case, the credit card processing would be on the full amount, which would include the taxes, which if that where the case then it would make sense.  I might be wrong about that though.


     Yes.  It is their processing fee which I believe captures more than just credit card fees.

    0Reply
  • Andrew SteffensBusiness Member
    Tampa, FL · Member since 2022 · 3k+ posts · 3k+ votes
    3y

    If you integrate with software that has payment processing you can collect and remit yourself and save yourself some $

    [email protected]813-563-0877
    Vacation Rentals of Florida53 Reviews
    WebsiteView Page
    1Reply
  • Leslie Anne Morris
    Real Estate Agent · Smoky Mountains, TN · Member since 2022 · 1k+ posts · 984 votes
    3y
    Quote from @Patricia Andriolo-Bull:
    Quote from @Leslie Anne Morris:

    I integrated with Ownerrez and now I process all payments outside of VRBO. Game changer. 


     I was thinking of this but on VRBOs website it states it still charges a commission.  Is that not accurate?

    You’re still going to pay a commission yes. They bill it after the fact on an invoice 
    0Reply
  • Ryan MoyerBusiness Member
    Property Manager · Orlando Kissimmee Davenport Salt Lake City, Park City · Member since 2019 · 991 posts · 1k+ votes
    3y
    Quote from @Ken Boone:
    Quote from @Ryan Moyer:
    Quote from @Dave Stokley:

    I mean they are collecting and remitting the tax for you, so there's value in that.


    It's not like they give you an option so they shouldn't be charging on it, nor does their competition.

    This would be like a PM taking their commission out of the total guest booking including taxes, which would be ridiculous.


     Correct me if I am wrong.  I was under the impression that that service fee is to cover the credit card processing.  If that is the case, the credit card processing would be on the full amount, which would include the taxes, which if that where the case then it would make sense.  I might be wrong about that though.

    Interesting.  I've always assumed that credit card merchant fees were only charged on the subtotal, not the post-tax total, but it looks like I was wrong about that.

    It seems kind of silly to think about.  So we are essentially paying for the privilege of collecting sales tax for the government. 

    Cosmic Vacations4.9172 Reviews
    WebsiteView Page
    0Reply
  • Jay ThomasPro Member
    Real Estate Agent · Houston, TX · Member since 2021 · 1k+ posts · 715 votes
    3y

    It's great to have the option of Airbnb or Vrbo when it comes to renting out your real estate property. It's important to understand that while Airbnb doesn't collect all taxes for you, Vrbo does, so depending on your situation, one might be a better fit than the other.

    [email protected]832-889-5607
    1Reply
  • Wesley Myers
    Rental Property Investor · Inlet Beach, FL · Member since 2019 · 91 posts · 32 votes
    3y

    So in FL can VRBO collect and remit all taxes including county taxes? If so, I need to figure this out. Having to log in and remit taxes on 2 different websites each month is a PITA. 

    0Reply
  • Julie Gates
    Real Estate Agent · Savannah, GA · Member since 2018 · 122 posts · 141 votes
    3y

    Just mark up the pricing for VRBO. I set this automatically through my property management system. If the nightly rate is $100, the guest is shown a nightly rate of $112.

    1Reply
  • Patricia Andriolo-Bull
    OP
    Member since 2022 · 527 posts · 413 votes
    3y
    Quote from @Ryan Moyer:
    Quote from @Ken Boone:
    Quote from @Ryan Moyer:
    Quote from @Dave Stokley:

    I mean they are collecting and remitting the tax for you, so there's value in that.


    It's not like they give you an option so they shouldn't be charging on it, nor does their competition.

    This would be like a PM taking their commission out of the total guest booking including taxes, which would be ridiculous.


     Correct me if I am wrong.  I was under the impression that that service fee is to cover the credit card processing.  If that is the case, the credit card processing would be on the full amount, which would include the taxes, which if that where the case then it would make sense.  I might be wrong about that though.

    Interesting.  I've always assumed that credit card merchant fees were only charged on the subtotal, not the post-tax total, but it looks like I was wrong about that.

    It seems kind of silly to think about.  So we are essentially paying for the privilege of collecting sales tax for the government. 

    Yup!
    0Reply
  • Patricia Andriolo-Bull
    OP
    Member since 2022 · 527 posts · 413 votes
    3y
    Quote from @Wesley Myers:

    So in FL can VRBO collect and remit all taxes including county taxes? If so, I need to figure this out. Having to log in and remit taxes on 2 different websites each month is a PITA. 

    VRBO just started collecting county taxes  in Collier County FL yesterday. Before it was just state. While it is a PITA, County  is quarterly and takes 5 mins. Rather not pay them 3% on an amount I’m not even keeping. 

    0Reply
  • Wesley Myers
    Rental Property Investor · Inlet Beach, FL · Member since 2019 · 91 posts · 32 votes
    3y
    Quote from @Patricia Andriolo-Bull:
    Quote from @Wesley Myers:

    So in FL can VRBO collect and remit all taxes including county taxes? If so, I need to figure this out. Having to log in and remit taxes on 2 different websites each month is a PITA. 

    VRBO just started collecting county taxes  in Collier County FL yesterday. Before it was just state. While it is a PITA, County  is quarterly and takes 5 mins. Rather not pay them 3% on an amount I’m not even keeping. 

    Bay county is monthly. Will have to check into it. 

    0Reply
  • Drew SygitBusiness Member
    Property Manager · Royal Oak, MI · Member since 2012 · 12k+ posts · 9k+ votes
    3y

    Get used to the government getting more involved as the industry matures.

    [email protected]248-209-6824
    Logical Property Management4.9459 Reviews
    WebsiteView Page
    0Reply
Join the conversationCreate a free account to reply, vote on answers and follow this thread.
Log InJoin for Free