With the beginning of the summer season, the topic of rest at sea becomes increasingly discussed. On the other hand, however, the owners of guesthouses and hotels are in feverish sweatiness. The hotel business in Bulgaria is not an easy niche. Every year, hotels and guesthouses face new challenges. In this article, we will try to provide you with a little more information about accounting of a guest house.
Registration and categorization.
Let’s start with the most basic in the accounting of a guest house – registration and categorization. Apartments and guesthouses under the Tourism Act (ACT) are at their core tourist sites of class B. As such, they are categorised (Art. 119 TT). For this purpose, an application shall be submitted containing the information provided for in Article 10( 129 TT to the mayor of the municipality or an official authorized by him. For more information about company registration, click HERE.
Speaking of the accounting of a guest house, it is important to note that the law allows the activity to be carried out by a non-marketer. In other words, the hospitality activity in a guest house or apartment can also be carried out by an individual without a company and commercial accounting.
It is also necessary to categorize the rooms that you will rent in the municipality on whose territory the house is located. For the rented rooms a register is kept and monthly up to 15th a declaration is submitted to the municipality for the realized nights in the rooms rented by the company and the corresponding due tourist tax is paid.
One of the frequently asked questions regarding guest kits is in connection with online platforms such as AIRBNB. For the vast majority of people who are interested in such activity, it is important to know that accounting for a guest house also needs it. As of 01.01.2020, guest rooms and guest apartments online, including via an electronic platform such as AIRBNB, can only be offered for categorized or registered accommodation.
In the case of accounting of a guest house, a simplified regime is applied under the VAT – with a tax rate of 9%. It is important to note that this rate is only applicable to overnight rates. For example, the sale of drinks and food in the establishments in guesthouses is subject to 20% VAT.
In addition to VAT, the local tourist tax is due under the Local Taxes and Fees Act (TTBT). It is taxed overnight. It is determined by an ordinance of the municipal council and amounts between BGN 0.20 and BGN 3.00. for each night. Please note that the size is according to the settlements in the municipality and the category of accommodation. The tax due shall be paid until the 15th of the month following the month in which the nights are provided.
Here is another important point in terms of accounting for a guest house. As a natural person, you owe tax under the Personal Income Taxes Act (IFL). In determining the taxable amount, 10 % of the eligible costs, which are considered as operating costs, shall be deducted. The tax amounts to 10% and is due by 30 April of the year following the year in which the income was realized.
In all cases of activity of renting apartments and guesthouses. No matter if as a trader and as a non-trader, you process personal data of the persons you are staying in. Although not so related to the accounting of a guest house, we would like to emphasize this moment. By carrying out the hotel activity, you also act as a personal data controller (PD). You have the obligation to bring the processing activity of the PD in accordance with the PDPA and GDPR. As an PD administrator, you must prepare, comply with and make your personal data policy available. The minimum requirements for the Policy are to define the purposes for which the PD is processed. To ensure the basic principles of transparency, accountability and respect for consumer rights.
If you need a reliable accountant for your guest house, we at T&G Consulting will provide it for you. We will help you optimize your finances and revenue-spending activities.