Beginner’s Guide on Starting an AirBnb Business in the United Kingdom

Starting an Airbnb business is a risky and competitive venture that also requires legal considerations. The initial preparation for setting up an Airbnb is learning the ins and outs of Airbnb procedure, rules, and etiquette. Furthermore, people make the mistake of not grasping how the Airbnb business model works from the perspective of guests and hosts. It’s not enough to list a house on Airbnb to succeed; hosts must also improve their Airbnb ranking.

Airbnb’s revolutionary business model ruled 191 countries, according to the 2018 Disruptor 50 list, which put the home-sharing company third. With over 5 million listings, 300 million customer reservations, and a market capitalization of $31 billion, Airbnb shows quick growth. According to statista.com, Airbnb had over 223 thousand active listings in the United Kingdom in 2018. Between July 2017 and July 2018, 8.4 million guests stayed with Airbnb accommodations.

When hosting on Airbnb, you must follow all applicable United Kingdom and local laws. Business rates apply when a host rents out their property for more than 140 days in the United Kingdom. There are also restrictions in Greater London that make it illegal to sublet a property for more than 90 days.

Hosting with Airbnb gives travel opportunities through guest connections and the ability to buy and rent more properties. Great hosts must have solid hospitality management, organizational skills, and strong communication abilities. Airbnb focuses on customer satisfaction, so Airbnb businesses require people-person individuals. This article is a 3E Accounting Airbnb business guide to company registration

 

What is an Airbnb Business?

Airbnb is an online accommodation marketplace that allows hosts to rent space ranging from single rooms to entire houses. It is frequently less expensive and more convenient than staying at a hotel. It connects hosts and guests and makes renting rooms easier. It offers a more authentic experience, allowing travellers to meet new people and learn about the locals.

 

Business Registration Process for Starting an Airbnb Business

Registering and listing a property on Airbnb is the first step in becoming an official Airbnb host. It’s as simple as uploading photos and writing a detailed description of the place. The request will show on the company’s website once verified, and potential guests can find it. Guests can contact and ask the host personally for any extra information or queries they may have.

Fill out an application for an Energy Performance Certificate for your property. An Energy Performance Certificate (EPC) explains your property’s energy efficiency and what you can improve. When you list your space as a new host, you can upload your Energy Performance Certificate. Existing hosts can update their listings to include their Energy Performance Certificate.

United Kingdom company incorporation requires registration with Her Majesty’s Revenue and Customs to ensure correct and on-time tax payment. The business responsibilities vary depending on the type and structure of the business process. Other registration requirements depend on the company’s size and development. In the United Kingdom, sole traders, business partnerships, and limited companies are the most frequent business structures.

Airbnb income is taxable and may be subject to various taxes, including income tax, business rates, corporation tax, and VAT. If your VAT taxable turnover exceeds £85,000, you must register for VAT. The Rent-a-Room Scheme allows you to earn up to £7,500 tax-free by renting space in your primary house with other people. To find out if you need to disclose the amount you earn from hosting, go to HM Revenue & Customs.

 

Licenses & Permits for Starting an Airbnb Business

A planning permit is crucial for anyone renting out housing for more than 90 days per year. Temporary Sleeping Accommodation is its term. Planning permits utilize third-party sites like Airbnb or Booking.com to rent out the property on a short-term basis. Failure to get permission may result in the cessation of activity as well as a heavy fine.

A planning limitation in Greater London impacts short-term rentals. Check with your local planning authorities to see if short-term rentals are allowed in your region.  The exclusion does not apply if you utilize your home for short-term rentals for more than 90 days in a calendar year. Contact 3E Accounting for legal advice and company incorporation assistance.

Anyone who offers to supply tourist lodging as a company is in violation of the Tourism (Northern Ireland) Order 1992. It is important to have a valid Tourism NI accreditation for the premises. These rules apply to all types of tourist accommodations. You must determine whether your property falls into one of the regulated accommodation categories and take the necessary steps.

Notification to process a personal data license is necessary. If your company processes personal data automatically, you must notify the Information Commissioner’s Office (ICO). A public surveillance license is mandatory to conduct manned guarding activities with CCTV equipment. A license for a residence in multiple occupations allows you to rent out your home to at least five people.

 

How to Grow an Airbnb Business?

Assess the Market

Take the time to investigate the Airbnb website before signing up as a host, focusing on similar rentals. Take notice of the cost, amenities, and facilities, as well as the customer reviews. Be realistic about your own and your visitors’ expectations and learn from other hosts’ experiences. It is an excellent strategy before signing up.

Successful hosts are meticulous in preparations and details. You might consider providing board games, books, movies, and other forms of amusement for your visitors. Make sure there are condiments, coffee, and tea in the kitchen as well. When guests arrive, be as welcoming as possible to create a good rapport.

Promote Local Experience

The majority of visitors want accommodations that- allow them to enjoy everything the local destination offers. Starting an Airbnb business needs consideration of guests’ transportation to leisure activities. By designing and maintaining an up-to-date handbook, you may provide great services. To boost the profit you may make from each listing, try promoting recent experience testimonials.

Consider the type of experience you’ll provide potential visitors on Airbnb to set yourself distinct. With so many listings on the site, hosts who highlight unique location features are more enticing. Responding fast provides guests with the greatest possible experience and reduces the likelihood of guests booking elsewhere. When responding to requests from potential guests, having prepared responses can save time.

Attract Long-term Booking

Every booking necessitates coordination with visitors, linen changes, cleaning of the rental unit, and so on. Even though a one-night booking involves the same effort as a one-month booking, revenue is different. After all, your time is a finite resource that you cannot replace. One alternative is to charge more for overnight stays of one or two nights.

You can charge a higher nightly cost and then provide significant discounts for reservations made weekly or monthly. Another option is to enforce a minimum stay requirement. If you choose to host a guest for a few months, they have a greater standard of responsibility in your home. 3E Accounting can help you with financial decisions to have a more steady cash flow.

Update Listing

You must include enough detail in your listing to stay relevant in Airbnb’s search engine. Before deciding whether or not to contact you, potential visitors will first see your web presence. More than a block of descriptive text, photos of your area that provide a realistic portrayal will entice consumers. Take note of the parking rules in the listing and the amenities value that your establishment might provide.

Always state how many bedrooms there are and the size and quantity of beds in each one. Set a minimum stay requirement for your listing. Adapt it based on how far ahead of time a person makes a reservation. Additionally, avoid charging extra for products that most hosts provide at the price of the stay.

Promote Your Business

You must advertise your home if you want to optimize your bookings and boost your net Airbnb revenue. Use social media, related forums, and websites to attract guests who aren’t already looking for a place to stay. The best hosts don’t only rely on Airbnb to drive visitors to their listings; they assure internet visibility. If you market your property online, it will enhance your Airbnb revenue.

Attending real estate, technology, and Airbnb-related events may help you attract new investors and partners. You’ll also have access to items and services you might not have known about otherwise. You may strengthen your business by networking and leveraging the experiences and successes of other Airbnb hosts. 3E Accounting corporate service provider can help you in starting an Airbnb business at your best convenience!