As an operator of a Short-Term Rental, Inn or Bed & Breakfast, it is the responsibility of each lodging operator to collect, report, and deposit with the City Finance Office, the 3% Transient Room Tax on a monthly basis. This requirement is established by Kentucky Revised Statutes (91A.390) and a joint Winchester and Clark County Tourism Ordinance.
While many short-term rental online platforms collect and remit the state 1% room tax and sales tax on behalf of their hosts, they often do not collect the required local tax in Winchester/Clark County, KY. HOSTS are responsible for collection and remission of the local 3% transient tax to the Winchester Finance Office.
Taxes are a cost that you may want to pass on to your customer. Please bear in mind that, as a host, you are liable for the taxes whether you pass them along to your customer or not.
For example, if you charge a $100 rental fee, the total local transient tax amount owed would be $3.00. Sales tax is caluclated after transient tax is added. If you want to pass all taxes onto the customer, their total bill would be $110.00. See below for an example rate card.
Transient Room Tax Calculator
|3% Local Transient Tax||$3.00|
|1% State Transient Tax||$1.00|
|6% Sales Tax||$6.24|
|Total Customer Bill||$110.24|
Transient Taxes are due on the last day of the month that FOLLOWS the month taxes were collected. For example, taxes collected from guests in January are due the last day of February. The local ordinances, pursuant to state statute, provide for a late penalty of ten percent (10%) plus interest at the rate of one-half of one percent (.5%) for each month of delinquency or fraction thereof, until paid.
Please be aware there is no exemption from this tax. Guests who stay longer than thirty days or companies or organizations such as church groups, government employees are not exempt from the Local Transient Room Tax.
It is very important to notify of us of any changes that relate to your rental property, including name change in properties, change of ownership, or management company name and address, as well as the effective date.
The Transient Room Monthly Tax Form can be accessed here.