Businesses subject to the rooms tax
Following is a noninclusive list of types of businesses
which must charge tax:
• Hotels, motels, inns, bed and breakfasts
• Coages,cabins,condominiums,campsites,andski
lodges
• Rooms in homes, primary homes, vacation or
second homes
• Other types of sleeping accomodations owned
by private individuals for which a rental fee is
charged, such as treehouses and yurts
What is a hotel?
Hotel accommodations are subject to the Vermont
RoomsTax.Ahotelisbroadlydenedasan
establishment that holds itself out to the public by
oeringsleepingaccommodationsforacharge.This
includes rooms in private houses and other types
of privately owned lodging if you rent out your
accommodations for 15 days or more in a calendar year.
Pleasenotethattherst14daysarealsotaxable.
What is not a hotel?
The following are not considered hotels and therefore
are not required to collect the rooms tax:
• Hospitals, nursing homes, homes for the aged, or
retirementcommunitiescertiedunderVermont
law at 8 V.S.A. Chapter 151
• Facilities operated by any Vermont or federal
institution, except the Vermont Department of
Forests, Parks and Recreation
• Dormitories or living quarters provided by a
summercamporaschooltochildrenaending
the school (Exception: The charge for a dormitory
room rented out by a school to persons other than
students is taxable.)
•Hotelsoperatedbyanonprotcorporation,with
certain exclusions
What Is subject to rooms tax?
Any charge by a hotel that gives a person the right to
use rooms, furnishings, or services of the hotel is subject
to the rooms tax. The tax applies whether or not the
room contains sleeping accommodations, as long as it is
locatedinanestablishmentthatisdenedasa“hotel.”
For example, a conference room located within a hotel
that is rented out is subject to the rooms tax. The rental
provided use of a room in a hotel, even though the room
was not used for sleeping accommodations.
Optional services, other than the use of the room,
are not subject to the rooms tax as long as the service
charge is separately stated on the guest’s bill. Optional
services may include use of facilities, lessons, or rental of
equipment. If the rental is presented as a package with
pricing inclusive of services, then the entire package is
subject to rooms tax.
Therearethreeclassicationsofoccupancy:
• Daily: Day-to-day rentals are subject to rooms tax.
• Long-term rental (no lease agreement): Rentals
are exempt after 30 days of continuous occupancy.
The occupancy does not have to be in the same
room, but must be in the same hotel. On the 31st
day, the renter is considered a permanent resident
and the charge for the room rental is no longer
subjecttotax.However,therst30daysare
subject to the rooms tax.
• Pre-existing lease agreement for at least 30
days that creates a landlord-tenant relationship
between parties:Arentalthatmeetsthisdenition
is exempt from the date of the lease agreement.
DEPARTMENT OF TAXES
Disclaimer: The information provided here is intended to be an overview
only. Vermont tax statutes, regulations, Vermont Department of Taxes
rulings, or court decisions supersede information presented here.
Rev. 02/2020 • Pub. FS-1021
Vermont Rooms Tax for Businesses
Businesses need to know the circumstances in which the 9% Vermont Rooms Tax applies to them. This fact sheet
isacontinuationofthe“VermontMealsandRoomsTaxforBusinesses,”providingfurtherdetailsforbusinesses
renting rooms and collecting tax. For more detailed information, you should refer to Vermont tax law and the
Vermont Department of Taxes website at tax.vermont.gov for regulations, technical bulletins, and fact sheets on the
topics presented here.
Please note:
Forfeited deposits are subject to the rooms tax.
Page 1 of 2
Rentals by private individuals
People who own property in Vermont often rent rooms
in their homes, the entire home, or other types of
lodging to visitors. If you own and rent any of these
types of accommodations to guests for 15 days or more,
consecutive or nonconsecutive, in a calendar year, you
must collect and remit the rooms tax. Any meals served
aresubjecttomealstax.Pleasenotethattherst14
days are also taxable. The tax applies to a rental that is
made to one renter or multiple renters over the course
ofayear.Formoredetails,seethefactsheet“Rentinga
RoomwithaView?”
Know tax law and regulations
Business owners are expected to be familiar with state
tax laws and regulations applicable to their businesses.
For more information, please see the following:
32 V.S.A. Chapter 233
legislature.vermont.gov/statutes/chapter/32/233
Meals and Rooms Tax Regulations
tax.vermont.gov/regulations
Technical Bulletins on Sales and Use Tax
tax.vermont.gov/bulletins
Fact Sheets
Seerelatedfactsheets“VermontMealsandRoomsTax
forBusinesses”attax.vermont.gov/fact-sheets.
Page 2 of 2
To learn more about Vermont business taxes, visit tax.vermont.gov
or contact the Department’s Business Tax Section at
tax.business@vermont.gov or (802) 828-2551.