Hotel Occupancy Tax - Frequently Asked Questions
How often do I file Hotel Occupancy Taxes?
Under City Ordinance Chapter 41, Article IV for Hotel Occupancy Tax, hotel occupancy tax is filed quarterly.
Jan 1 – Mar 31
Apr 1 – Jun 30
Jul 1 – Sep 30
Oct 1 – Dec 31
What is the City Hotel Occupancy Tax rate?
Under City Ordinance Chapter 41, Article IV for Hotel Occupancy Tax, the hotel occupancy tax rate is seven percent (7%).
How do I file Hotel Occupancy Taxes?
You will need your Permit Number to file your taxes if you are a short-term rental property located within the Fredericksburg City Limits.
Short-term rental properties located in the extra-territorial jurisdiction (ETJ) do not need a permit to file HOT. However, for now, we would ask that you file HOT using the paper remittance form and submit a check or money order with your form.
Hotels and motels do not need a permit to remit HOT. However, for now, we would ask that you file HOT using the paper remittance form and submit a check or money order with your form.
Do I file a quarterly Hotel Occupancy Tax Remittance form even if I did not have any receipts during the quarter?
YES. You will complete a remittance form for the quarter showing $0.00 receipts and $0.00 tax due.
How can I pay Hotel Occupancy Taxes?
If you file HOT online, you may pay by credit card or ACH draft from your bank account.
If you file HOT using the paper Hotel Occupancy Tax Remittance form, you may pay by check or money order.
Who do I make my check or money order payable to?
City of Fredericksburg
Where do I mail my remittance form and payment?
City of Fredericksburg
c/o Hotel Occupancy Taxes
126 W. Main St.
Fredericksburg, TX 78624
Where do I drop off my remittance form and payment?
During business hours, you may drop off your payment on the 1st floor in the Utility Billing Dept. at City Hall located at 126 W. Main Street. After hours, you may drop off your remittance form and payment in the drop box located on the Crockett Street side of the City Hall building.
My permit number will not work when I attempt to file HOT online. How do I file?
My property is in the ETJ. Do I pay HOT?
YES. You will remit HOT to the City of Fredericksburg.
Properties not located within the Fredericksburg City Limits or ETJ will remit HOT to the Gillespie County Treasurer’s office at a rate of seven percent 7%. Click here for more information.
How do I find out if my property is in the extra-territorial jurisdiction (ETJ) for Fredericksburg?
Who is required to remit HOT?
A hotel, motel, short-term rental, bed & breakfast or any lodging facility in which members of the public rent sleeping accommodations. City hotel occupancy taxes apply to sleeping rooms costing $2.00 or more per day. The owner, operator, or manager must collect hotel occupancy taxes from its guests and remit this to the respective State & Local entities.
The tax covers hotels, motels, and bed and breakfasts, as well as condominiums, apartments and houses rented for less than 30 consecutive days. Hotel occupancy tax does not apply to hospitals, sanitariums, nursing homes, student dormitories operated by colleges and universities, or condominiums, apartments, and houses leased for more than 30 consecutive days.
What is taxable?
Taxable revenue includes your gross taxable receipts, cleaning fees and pet fees. When calculating the hotel occupancy tax due, seven percent (7%) is multiplied by the gross taxable receipts amount, cleaning fees and pet fees.
For example, if the nightly rate is $300 per night, a cleaning fee of $100 is charged, a pet fee of $50 is charged and the guest stays two nights, the total taxable receipts amount is $750.
$300 X 2 nights = $600 plus $100 cleaning fee + $50 pet fee = $750 total taxable receipts
$750 X 0.07 (7%) = $52.50 tax due
Note, taxpayers that multiply seven percent (7%) by the amount of revenue deposited to their bank account after service fees are deducted by their reservation service (AirBnB, VRBO, etc.) are not calculating the correct amount of tax due. A 15% penalty and interest charge will be assessed on the additional hotel occupancy tax due.
Do reservation services like AirBnB and VRBO remit HOT to the City of Fredericksburg on my behalf?
NO. Reservation services like AirBnB and VRBO do not remit HOT to the City on your behalf. In most cases, these reservation services will only remit HOT to the State on your behalf and make it your responsibility to remit HOT to the local municipality.
Always verify the services your reservation service should perform on your behalf to ensure there is not any miscommunication between you.
What is exempt from HOT?
If your customer claims they are exempt from paying hotel occupancy tax, they must provide a Hotel Occupancy Tax Exemption Certificate and qualify for one of the reasons listed on the exemption certificate.
The only customer not required to provide an exemption certificate are customers who stay in a hotel, motel, bed and breakfast or short-term rental for longer than 30 consecutive days.
Common Exemptions include:
- Guest stays over 30 consecutive days,
- State & Federal Officials or Employees,
- Charitable Entities – 501(c)(3) or nonprofit organizations,
- Educational entities (exempt from State hotel tax, but NOT local hotel tax), and
- Religious organizations
It is important to read the exemption certificate for details. This will help you determine if your customer qualifies for an exemption from paying hotel tax.
Where can I find more information?
Please visit https://fbgtx.org/487/Hotel-Occupancy-Taxes.