If you own or are planning to open a short-term rental business in the City of Pikeville, KY there are taxing requirements and local zoning regulations information to follow. This document will help you understand all the license, tax and zoning ordinances and regulations that go hand-in-hand with hosting a short-term rental.
This information document is intended to supplement any information and guidelines that may have been provided by a short-term rental company. This guide in not intended to be a substitute for legal advice.
Airbnb, FlipKey, HomeAway, Vacation Rental by Owners (VRBO) and any other type of rental that meets the definition below are all considered short-term rentals.
A short-term rental is defined as:
A dwelling, unit or room that is rented, leased or assigned for a tenancy of less than thirty consecutive days in duration and where no meals are served or provided by the host to any guest. A short-term rental may be owner occupied or non-owner occupied.
Obtain a Business License from the Tax Department: (ada Occupational License)
Anyone that opens a business in the City of Pikeville KY must obtain a business license (also known as an occupational license). The license fee is $50.00 per calendar year.
The City of Pikeville, KY has a step-by-step online guide to help you through this process.
As a short-term rental host, you are required to pay taxes on the rental income you receive. These taxes include:
Taxes are a cost that you may want to pass on to your customer. (Remember that as a host, you are liable for the taxes whether you pass them along to your customer or not.
KRS Chapter 142 – Section 400 creates a transient room tax (lodging tax) at the rate of 1 percent of the rent, on every occupancy of any suite, room, rooms, or cabins charged by all persons, companies, corporations, groups, or organizations doing business as motor courts, motels, hotels, inns, tourist camps or like or similar accommodations businesses (excludes campgrounds).
The transient room tax is in addition to the current 6 percent sales tax, and any locally assessed transient room tax, and will be reported separately each month.
For example, if you charge a $100 rental fee, the total tax amount owed would be $14.48. If you want to pass those taxes on the customer, their total bill would be $114.48. See the below rate card for details.
| EXAMPLE OF TAX TO CHARGE PROCESS | ||
| Room Rate | $100.00 | |
| 3% Local Transient Room Tax | $3.00 | |
| 1% East KY Expo Transient Room Tax | $1.00 | |
| 1% State Transient Room Tax | $1.00 | |
| 3% Pike County Tourism Transient Room Tax | $3.00 | |
| Subtotal Taxable Amount | $108.00 | |
| 6% Sales Tax | $6.48 | |
| Total Due: | $114.48 | |
Any earnings you receive from rentals may be subject to the local net profits occupational license fee at 2% or the minimum fee requirement of $50.00. You will find information about this when you register for your City of Pikeville, KY Business License.
Consider consulting with a financial advisor for accounting and tax advice.
As a short-term rental host, you must adhere to the City of Pikeville, KY zoning ordinances and regulations. You may review all city ordinances online at https://pikevilleky.gov.
The City of Pikeville, KY has local Zoning Regulation and you may contact the Enforcement Officer: Jamie Potter at (606)-444-5289 or (606)-422-0251.
As with any business, there are other considerations you should be aware of when operating a short-term rental. You should consider consulting with a legal advisor for assistance with any legal issues that may be involved with this type of business.
Some of these considerations include:
Review your insurance policies and consult with your agent to make sure that they cover injuries, accidents or losses arising from the use of the property by renters.
Every attempt has been made to ensure that the information contained herein is complete, up-to-date and accurate. However, this does not release the owner or host from their obligation to verify the information and the obligation to comply with the regulations listed above and any other applicable rules or requirements, governmental or private.
