Document Number
07-141
Tax Type
BPOL Tax
Description
County is requiring the Taxpayer to remit transient occupancy tax.
Topic
Local Power to Tax
Date Issued
09-05-2007


September 5, 2007



Re: Request for Advisory Opinion
Business, Professional and Occupational License tax
Transient Occupancy Tax

Dear *****:

This is in response to your letter requesting an advisory opinion about the applicability of the transient occupancy tax and the business, professional and occupational license (BPOL) tax to the occasional rental of your second home.

The local license fee and tax are imposed and administered by local officials. Virginia Code § 58.1-3701 authorizes the Department to promulgate guidelines and issue advisory opinions on local license tax issues. The following opinion has been made subject to the facts presented to the Department summarized below. Any change in these facts or the introduction of facts by another party may lead to a different result.

The Code of Virginia sections and public document cited are available on-line at www.tax.virginia.gov in the Tax Policy Library section of the Department's web site.

FACTS


***** (the "Taxpayer") owns a second home in ***** (the "County") that is rented for periods of less than 30 days. The house is rented for about a third of the year and used by the Taxpayer for the other two-thirds. The County assessed BPOL taxes on the rental of the house. In addition, the County is requiring the Taxpayer to remit transient occupancy tax. The Taxpayer requests an opinion as to whether she is required to pay these taxes.

OPINION


BPOL Tax

Virginia Code § 58.1-3703 C 7 prohibits any locality from imposing a license fee or tax:
    • [u]pon any person, firm or corporation for engaging in the business of renting, as the owner of such property, real property other than hotels, motels, motor lodges, auto courts, tourist courts, travel trailer parks, lodging houses, rooming houses and boardinghouses . . .

Under this provision, persons who rent their private residences are clearly exempt from both the license tax and fee. For further discussion of this, see Public Document (P.D.) 99-13 (1/14/1999).

Transient Occupancy Tax

Virginia Code § 58.1-3983.1 authorizes the Tax Commissioner to issue advisory opinions of certain local business taxes. These taxes are: the business tangible personal property tax, the machinery and tools tax, the merchants capital tax and the local mobile property tax. Therefore, I do not have jurisdiction to issue an advisory opinion or make any determination with respect to the transient occupancy tax.

All other local business tax assessments, including transient occupancy tax assessments, may be appealed first through the local commissioner of the revenue, under the provisions of Va. Code § 58.1-3980, then, if necessary, to the circuit court pursuant to the provisions of Va. Code § 58.1-3984.

If you have any questions regarding this opinion, you may call ***** Office of Policy and Administration, Appeals and Rulings at *****.
                • Sincerely,


                • Janie E. Bowen
                  Tax Commissioner




AR/1-1421233995H

Rulings of the Tax Commissioner

Last Updated 08/25/2014 16:46