Revenue Tax Exemptions and Reductions (Cloud)
Some jurisdictions allow room revenue taxes to be reduced or removed after a guest stays a specified number of nights. Visual Matrix can automatically apply these tax reductions, generate tax credits when required, and determine whether complimentary or free-night reservations participate in the exemption process.
Path: Management > Property Settings > Taxes Settings > Revenue Tax Codes
Configure Revenue Tax Reductions and Exemptions
The Revenue Tax Exemption settings allow properties to automatically reduce or remove room taxes after a reservation reaches a qualifying length of stay.
Reduced Tax Percent
Defines the tax percentage that should apply after a reservation qualifies for a tax reduction or exemption.
Example – Full Exemption
| Standard Tax | Reduced Tax |
| 10% | 0% |
After the qualifying number of nights is reached, no additional revenue tax is charged.
Example – Partial Reduction
| Standard Tax | Reduced Tax |
| 10% | 5% |
After the qualifying number of nights is reached, the reduced tax percentage is applied instead of the standard tax percentage.
Reduce Revenue Tax After
Defines the tax percentage that should apply after a reservation qualifies for a tax reduction or exemption.
Example – Full Exemption
| Standard Tax | Reduced Tax |
| 10% | 0% |
After the qualifying number of nights is reached, no additional revenue tax is charged.
Example – Partial Reduction
| Standard Tax | Reduced Tax |
| 10% | 5% |
After the qualifying number of nights is reached, the reduced tax percentage is applied instead of the standard tax percentage.
Configure Automatic Tax Credit Adjustments
When enabled, Visual Matrix automatically posts tax credits after a reservation qualifies for a tax reduction or exemption.
This feature is commonly used when taxes have already been charged during the earlier portion of a stay and must be adjusted once the guest qualifies for reduced or exempt tax treatment.
Example:
- Standard Revenue Tax: 10%.
- Tax Exemption Begins After: 30 Nights.
- Guest Reaches Night 30.
Visual Matrix automatically posts tax credits to adjust taxes that should no longer apply based on the property's exemption rules.
Tax credits generated through this process are not included in the Tax Exempt Report.
Configure Reservation Types Included in Tax Reductions
Reduce Revenue Tax For
Select which reservation types should participate in the automatic tax reduction process. These settings determine whether those reservation types are included when applying the property's tax reduction rules.
Comp Nights
Includes complimentary reservations when calculating automatic tax reductions and exemptions.
Free Nights
Includes reservations containing free nights when calculating automatic tax reductions and exemptions.
Save Changes
After modifying the Revenue Tax settings, click Save at the top of the page to store your changes. Unsaved changes will not be applied to the property configuration.
Understanding the Revenue Tax Exemption Settings
Setting | Purpose |
Reduced Tax Percent | Defines the reduced tax percentage applied after qualification. |
Reduce Revenue Tax After | Defines when the reduced tax percentage becomes effective. |
Automatic Tax Credit Adjustment | Automatically posts tax credits after a reservation qualifies for a tax reduction or exemption. |
Comp Nights | Includes complimentary reservations in the tax reduction process. |
Free Nights | Includes reservations containing free nights in the tax reduction process. |
Still Need Help With This Topic?
Ask Yourself:
- Does your jurisdiction require tax reductions or exemptions after extended stays?
- What reduced tax percentage should be applied after qualification?
- After how many nights should the reduction begin?
- Should complimentary reservations participate in the exemption process?
- Should free-night reservations participate in the exemption process?
Support May Ask You:
- What is the property's standard revenue tax percentage?
- What reduced tax percentage should be used?
- How many nights are required before the reduction takes effect?
- Is Automatic Tax Credit Adjustment enabled?
- Should complimentary and free-night reservations be included?
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