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Sales Tax Regulations

State of Rhode Island - Division of Taxation

Sales and Use Tax

Regulation SU 87-103

 

Camp Cottages -- Rentals by Real Estate Agents

In General -- Where the owners of camp cottages or cabins (regardless of whether such persons own one or more than one camp cottage or cabin) place such property in the hands of a real estate agent for rental purposes, the real estate agent, being "engaged in the business" of renting living quarters, is liable for the tax on rents he or she collects from such letting.

This is so even though a person who owns only one camp cottage or cabin and rents it out, would not be required to charge and remit the tax.

(The rental or lease of residential-type dwellings is covered by SU 87-97. See heading "Rentals Excluded - Permanent-type Dwellings.")

Registration -- Such real estate agent should file an application for a permit, which permit will be issued in the name of such agent and contain the agent's office address. For example,

John Doe, Agent
100 Jones Street
Westerly, Rhode Island

Inasmuch as such agent must register as indicated and is the person responsible for collecting and remitting the tax, each individual cottage owner who does business exclusively through such agent is not required to register and obtain a permit.

Therefore, such agent requires only one permit and such permit will suffice to cover all properties from which taxable rentals are collected.

Reports -- Each such agent must file a return on or before the 20th day of each month, on forms furnished by the Division of Taxation, showing all rentals for the previous calendar month, and at the same time must remit the tax which is due thereon.

The tax applies only to the first period of not exceeding 30 consecutive calendar days of each rental period. For example, a person who rents a cottage for two months will not be required to pay the tax on the rental charged for that portion of continuous occupancy beginning the 31st day of tenancy.

Separate returns for each camp cottage or cabin thus handled by a real estate agent are not required. Rather, such agent may file one monthly return in which he or she may account for all rental receipts derived during the preceding month from all such cottages and cabins, and at the same time should remit the total tax due thereon in one lump sum.

However, such agent must keep suitable records relating to each such cottage showing:

(a) the name and address of the owner
(b) the names of the persons to whom rented
(c) the beginning and ending dates of their respective occupancies
(d) the number and length of each rental period during each such occupancy
(e) the rentals received from each such period, and
(f) the amount of tax payable thereon.

Where the letting is for a lump-sum covering a period of more than 30 days, the tax will be based on that proportion of such total amount of rental thus payable as 30 days bears to the total number of days in the entire rental period.

CROSS REFERENCE: Section 44-18-36.1 R.I.G.L. as amended re: "Hotel Tax"

R. GARY CLARK
TAX ADMINISTRATOR

DATE: May 1, 1987