Guest Payments for Airbnb Bookings
The Airbnb integration is unique in that Airbnb will accept payments on your behalf, and issue you a payout once the guest arrives. In most cases they will collect and remit some or all taxes on your behalf as well.
All rates and fees are sent from Lodgix to Airbnb. Airbnb will then charge the guest your rates and fees, plus taxes and the guest fee. The guest fee is a fee charged directly to the guest, by Airbnb. The invoice generated for the guest at Airbnb will include all of these charges. The invoice generated in Lodgix will include only the portion of the invoice that is payable to you... the rates and fees that you send to Airbnb.
Components of an Airbnb Invoice in Lodgix
The Airbnb integration is also unique in that the taxes and fees configured in your Lodgix account do not pass automatically to Airbnb. You have to set Airbnb specific fees on the integrations screen...
Rate Multiplier. This allows you to increase your nightly rates for Airbnb. A rate multiplier of 1.10 will increase rates by 10% on Airbnb only. The original rate set in Lodgix will still be used for all other channels.
Base Guests. You can elect to set a base number of guests included in the nightly rate, and then charge per person for additional guests beyond the base number of guests.
Cleaning Fee + Damage Protection. Airbnb does NOT pull in any fees that you might have setup within Lodgix already. Airbnb uses a generic cleaning fee to be the catch all fee for cleaning fees and any other misc fees that are being assessed to the guest. The damage protection fee will be auto populated ONLY if using the Lodgix damage protection products.
Management Fee. A management fee is a flat rate fee that represents any booking fees or administration fees that you wish to assess to the guest. This fee can be added to either the nightly rates or the cleaning fee when displayed on Airbnb. Either way, the fee will get passed back to Lodgix from Airbnb as a line item in the invoice.
Community Fee. This is a percentage based fee only. Many use this to collect taxes from the guests in juridictions where Airbnb does not collect tax. This fee displays like a tax in the sense that when a guest searches for a rental, this fee is not baked into the nightly rate on airbnb, instead, like a tax, it is computed at the end of the guest booking process.
The invoice generated in Lodgix will display a line item for the nightly rate (including rate multiplier), the cleaning fee, management fee, and community fee.
Airbnb Host Fee
Once you receive your payout from Airbnb, several payment transactions will post to the invoice in Lodgix... the Payout, Host Fee, and Airbnb Collected Tax (if applicable).
This can sometimes be confusing for those that have previously worked directly with Airbnb. In many cases the Host Fee was never taken into account at all. The Payout was simply considered the revenue from the booking.
Let's use an example of a $1,000 Airbnb booking, with a 5% host fee.
$1,000 x .05 = $50 (Host Fee)
$1,000 - $50 = $950 (Payout)
If the Payout is $950, why does the invoice total $1,000, and why is the Host Fee recorded at all?
Remember that the invoice is meant for the guest, and represents the total amount collected by Airbnb to cover the rates and fees that you have configured for the property. That would be $1,000. Airbnb then charges you a fee of $50, and issues a payout of $950.
The net result is the same, we are just taking into account the 5% fee that was previously ignored. This change could affect reporting, as well as payments to owners. Those issues are covered in the next two sections of the article.
Reporting on Host Fees
The Host Fee can be viewed on an invoice level from the guest control panel for each invoice...
You can also report on all Host Fees collected in a given time period from the guest transactions report. These will be totaled at the bottom of the report...
Host Fees on Owner Statements
Using our earlier example, you may need to reconcile the owners statement to account for the host fee. If you have traditionally paid out your owners and calculated your management commission based on the Airbnb payout ($950), you will not want to simply start paying out owners based on the higher total invoice amount ($1,000).
The solution is Channel Commissions. Sticking with our example, you can set a 5% channel commission for all Airbnb bookings from the Settings area of the Airbnb Integrations screen...
Then set each of your properties to assess the channel commission to the owner, and also calculate the management commission off of "Gross minus Channel Commissions"...
The 5% Airbnb commission will now be deducted from the $1,000 invoice total prior to calculating the management commission and payout.