A luxurious villa in Mykonos, with a rental price of 5,000 euros a night, had made sure it was visible where it needed to find its wealthy customers. It existed on social media, appeared on booking websites and had bank accounts for payments. But there was a place he remained «invisible»: in the electronic IRS kits.
The thread began to unfold by a... nail. Citizen filed a surname complaint with ADE – not as a general press information «Someone rents a villa and doesn't declare the money». The complainant gave an address, websites through which the reservations and bank accounts were made. I mean, enough pieces of the puzzle for the auditors to start looking for the rest. The information was assessed as a high tax risk and the case took its course of control. Banking movements entered the microscope and it was eventually revealed that the VIP villa of 5,000 euros a night had never been declared on the Brachython Rent Register. The bill that followed for the owner was heavy with a fine of tens of thousands of euros.
Pursuing it «black» money
The history of Mykonos reveals the great change in the way it is now being hunted «black» money on the short-term lease market. The time when a luxury property could be rented behind closed doors and the IRS should almost fall upon it to find out has passed. Today every villa, apartment or tourist home leaves behind a digital path: ads, photos, prices, reservations, Property Registration Numbers, payments and final tax returns. A complaint could just be the beginning. The information that arrives at AADE and is accompanied by specific data is assessed on the basis of tax risk and the possibility to cross-reference. An address, a booking link or an IBAN can turn a pin into a controlling thread. And once the auditors start pulling it, they now have much more resources available to reconstruct the actual activity of a property.
From the intersection of income declared owners with data transmitted by Airbnb, Booking.com and Vrbo for 2020, 2021 and 2022, 24,383 unique VAT were identified with deviations greater than 500 euros. These are natural persons without starting business with relevant CAD tourist accommodation. The picture becomes even more revealing if one sees the development per year: 6.222 VATs showed deviations in 2020, 10,724 in 2021 and 17,525 in 2022. Taxpayers are invited to correct their statements, while the previous application of a corresponding procedure for 2018 and 2019 had led to voluntary compliance of 56% and to the emergence of additional incomes over 7.2m euros.
«Double window»
However, where one hole closes another opens. One of the practices on radar is the so-called «double front»Airbnb or Booking is used to find the customer. There he sees the villa, photos, pool, location, evaluations and price. But the transaction can be completed elsewhere. The person concerned is transferred to direct contact with the owner or manager on a personal site or even social media. The lure is simple: «Close directly and you will pay less, since there will be no supply of the platform»In some cases it may even be suggested to cancel a reservation that has already started online. From there on payment can go a different way or break into more pieces. Leaving the platform certainly does not mean leaving tax obligations. The income from short-term leases must be declared regardless of whether the agreement was closed through a digital platform or directly. For ADE the crucial question is one: who was the real turnover of the property and how much of it finally appeared in the tax return?
To answer, the different electronic tracks can go side by side. Any short-term rental property must be registered on the Short-term Accommodation Property Register and acquired AMA, which appears on the relevant entries. Residences are declared electronically and income results in tax returns. Thus, a control chain is created: ad, AMA, reservation, payment, statement.
The booking details
How the real turnover can be reconstructed can also be seen in a case that arrived this year at the Dispute Resolution Directorate and concerns a tourism reservation management company. The uses tested were older, but the envelope is almost an X-ray of the method.
The auditors requested booking data from Booking, contracts, data per property and banking data. For the year 2019, against declared revenue from booking management EUR 58,488 the audit determined revenues of EUR 81,976, i.e. around EUR 23,500 more. Inbound transfers of EUR 4,106,89 were also identified for which, according to the audit, the corresponding tax data had not been issued.
Even larger control tank is created by those who exploit many properties. ADE has located 1,545 natural persons corresponding to a total of 6,344 active AMAs and had income from at least three properties or acquired a third active AMAs from 2024 onwards.
Of these, 1,017 had not progressed to the required start-up business, while 528 others had not declared the planned SDRs for short term lease. ACE sent them compliance notifications and within 2026 assesses the results.
