A Clear Guide for UK-Based Holiday Letting and Short-Term Rental Businesses
In the rapidly evolving landscape of digital services and property management, staying compliant with tax regulations has become more complex than ever. One such regulation that property agencies across the UK and EU must now navigate is DAC7 – a new EU directive that aims to increase transparency and standardise tax reporting for online platforms.
If you’re a property owner managing short-term rentals—especially if you work with platforms like Airbnb, Booking.com, or use channel managers and booking software like SuperControl—this article will help demystify DAC7 and what it means for your business.
What Is DAC7?
DAC7 is the latest addition to the EU’s “Directive on Administrative Cooperation” (DAC) series. Officially known as Council Directive (EU) 2021/514, DAC7 requires digital platforms to collect and report detailed information about sellers (hosts) who earn income through the platform.
The key aim? To combat tax evasion and ensure that individuals and businesses who earn money via platforms are declaring and paying the correct amount of tax.
Though DAC7 is an EU regulation, it applies to UK property agencies if:
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They list properties on EU-based platforms (e.g., Booking.com)
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They are based in the EU or have operations within EU jurisdictions
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They work with platforms that are themselves DAC7 compliant (most major ones are)
Why Does DAC7 Matter to Property Agencies?
If you manage or advertise short-term holiday lets through online booking platforms or channel managers, DAC7 directly impacts how you collect, report, and store data.
Here’s how:
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Platforms must collect your data and report it to EU tax authorities
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If you operate on behalf of individual property owners, you may need to report on their behalf
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Non-compliance can result in penalties or removal from platforms
Think of DAC7 as the Airbnb/Booking.com equivalent of VAT MTD compliance: essential, inevitable, and best handled proactively.
Who Is Affected?
✅ You are affected by DAC7 if you:
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Manage properties listed on platforms like Airbnb, Vrbo, Booking.com, or Sykes
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Use property management software (PMS) or channel managers that facilitate bookings
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Act on behalf of owners by collecting payments, paying suppliers, or handling guest comms
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Own or manage more than one property used for short-term letting in the EU
🚫 You may be exempt if:
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You’re renting out long-term properties (over 90 consecutive days)
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You manage fewer than 30 bookings a year (some country-dependent)
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Your platform is purely for internal business use and not accessible by the public
Always check the specific criteria with the platforms you use.
What Information Must Be Reported?
DAC7 requires the following information to be collected and submitted:
For each seller (property owner or agency):
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Full legal name
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Primary address
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Tax Identification Number (TIN)
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VAT number (if applicable)
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Date of birth (for individuals)
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Business registration number (for companies)
For each property listing:
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Property address
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Type of property (entire home, room, etc.)
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Number of bookings and days rented
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Gross income earned through the platform
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Any fees, commissions, or taxes withheld
This information must be submitted annually to the relevant tax authority, typically by 31 January for the previous tax year.
What Platforms Are In Scope?
Almost all major booking platforms operating in the EU or with EU sellers are required to comply. This includes:
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Airbnb
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Booking.com
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Vrbo
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TripAdvisor
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Sykes Cottages
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Plum Guide
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SuperControl (when integrated with these platforms)
If you’re working with a channel manager or PMS, ensure they are also DAC7 aware. Some will automate reporting; others may leave it to you to handle.
How Does DAC7 Affect UK Agencies?
Although the UK is no longer in the EU, UK-based agencies are still impacted when they:
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Advertise properties located in the EU
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Work with EU-based property owners
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Use EU-based platforms
In these cases, UK businesses must:
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Provide accurate reporting data to platforms
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Comply with requests from platforms for updated tax information
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Ensure their contracts and data policies are DAC7-compliant
Failure to comply may result in platform restrictions or fines levied by EU tax authorities.
Step-by-Step: How to Stay Compliant
1. Understand Your Role
Determine if you are:
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A platform (if you offer direct bookings via your own website)
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An intermediary (if you manage listings on behalf of owners)
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A seller (if you rent out your own properties)
Your obligations may differ depending on the role.
2. Audit Your Data
Start by reviewing the data you currently hold for each owner:
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Do you have their TIN, DOB, and full address?
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Is each property properly tagged with type, location, and income tracking?
3. Use DAC7-Ready Software
Ensure that your PMS or booking platform supports DAC7 exports or automated reporting. Some helpful tools/platforms include:
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SuperControl (working on DAC7 readiness)
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Rentals United
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Smoobu
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Lodgify
4. Inform Your Owners
If you act on behalf of property owners, communicate clearly:
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What data is being collected
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Why it’s needed
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How it will be reported
This may require updating your terms of service and privacy policy.
5. Submit or Verify Reports
Many platforms will handle submission, but you should always:
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Double-check the data they are submitting on your behalf
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Keep a copy of any reports filed
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Be prepared to provide clarification if tax authorities follow up
Common Mistakes to Avoid
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❌ Assuming DAC7 doesn’t apply post-Brexit
If you operate in or advertise to the EU, it likely does.
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❌ Ignoring owner data accuracy
Incomplete TINs or mismatched addresses can result in report rejection.
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❌ Waiting for platforms to chase you
Be proactive. If platforms request data and you don’t respond, listings can be suspended.
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❌ Not reviewing net vs gross earnings
Always double-check what figure is being reported: full gross income or net of fees.
Case Example: UK Agency with EU Listings
Let’s say you’re a UK-based agency managing holiday lodges across Devon and also listing several villas in Spain and France through Airbnb and Booking.com.
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You will need to submit accurate DAC7 information for your non-UK properties.
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Airbnb will ask for your TIN and business registration.
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Booking.com may require per-property financial breakdowns.
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You’ll also need to ensure owners have consented to data use and understand what’s being reported.
If you’re managing multiple owners, you may also be responsible for ensuring their compliance.
How SuperControl and Channel Managers Help
If you use platforms like SuperControl or Rentals United, they may offer DAC7 features such as:
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Field entry for seller tax information
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Booking-level financial exports
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CSV reporting formatted for DAC7
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Integration with Airbnb/Booking.com data syncs
Check with your provider for the latest updates and whether any action is required from your end.
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Your DAC7 Checklist
✅ Confirm whether DAC7 applies to your agency
✅ Ensure all relevant seller and property data is up to date
✅ Use DAC7-compatible booking systems or exports
✅ Educate owners on what is being reported
✅ Keep records of submissions and responses from platforms
✅ Monitor communications from Booking.com, Airbnb, etc., for DAC7 requests
Final Thoughts: A Positive Step for Transparency
While DAC7 may seem daunting at first, it is ultimately a tool for improving transparency and levelling the playing field. By proactively collecting the right data and understanding your obligations, you can turn DAC7 from a compliance challenge into an operational strength.
For property agencies that get it right, DAC7 means:
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Easier collaboration with platforms
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More trust from owners
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Reduced admin and risk in the long term
So, take the time now to align your systems, update your owner records, and speak to your booking partners. DAC7 is here to stay—make sure your business is ahead of the curve.
Need Help?
If you’re unsure about how DAC7 affects your property agency or need help gathering the correct data, speak to your account manager at your booking platform, or consult a qualified tax adviser with knowledge of EU cross-border reporting.
