What actually lands in your account

How the arithmetic works

Four deductions sit between a guest's card and an owner's bank account, and they happen in an order that matters.

1. Gross guest spend. The nightly rate multiplied by booked nights, plus the cleaning fee multiplied by the number of stays. Cleaning is money the guest pays, so it belongs in the gross figure.
2. Platform commission. Taken by the booking site on its own base, which varies by platform and by whether the fee model is host-only or split with the guest.
3. Cleaning paid out. Collected from the guest and passed to whoever does the changeover. It arrives and leaves.
4. Management fee. A percentage, charged on one of three bases.

The three bases, and why the difference is not small

A management fee is a percentage of something, and that something is not standardised across the market. The three bases in general use are:

• Gross guest spend. The percentage applies to everything the guest paid, cleaning included. This is the largest base, so it produces the largest fee.
• After platform commission. The percentage applies to what reached the account after the booking site took its cut.
• After commission and cleaning. The percentage applies only to the money that is genuinely yours to keep before management, which is the smallest base and the smallest fee.

On the default figures above — a £140 nightly rate, 180 booked nights, four-night average stays and an £85 cleaning fee — the gross guest spend is £29,025for the year. A 15% management fee on that base is £4,354. The same 15% charged after a 3% platform commission is £4,223. Charged after commission and cleaning it is £3,649.

That is a £704 spread on one property in one year, from an identical headline percentage. It is the single most common thing owners discover late, and it is decided by one line in an agreement.

What VAT does to a quoted percentage

Where a fee is quoted plus VAT, add it before comparing. A fee quoted at 20% plus VAT costs 24% of the base at the current standard rate. A fee quoted at 15% plus VAT costs 18%. Two managers quoting the same number are not necessarily charging the same amount, and a quote that does not say which it is has not answered the question.

What this tool does not cover

It answers one question: what reaches your account from the bookings. It takes no view on your mortgage, insurance, utilities, council tax or business rates, repairs, consumables or income tax, and it is not a forecast of what any property will earn. Where tax is concerned, how to declare short-let income on Self Assessment covers the return itself.

For when the money actually arrives rather than how much of it,the payout timeline walks through the four stages. For what a management fee should buy in the first place,what Airbnb management costs in the UKcovers the models and what usually costs extra.

Frequently asked questions

Why does the same percentage give three different answers?

Because a management fee is charged on a base, and the base is not standardised. The same percentage applied to gross guest spend, to the amount left after platform commission, or to the amount left after commission and the cleaning fee, produces three different numbers from identical bookings. The fee basis is as important as the fee.

Should the cleaning fee be inside the management fee base?

That is the question to put to any manager in writing. The cleaning fee is collected from the guest and paid out to whoever does the changeover, so charging commission on it means charging commission on money that passes straight through. Some agreements do, some do not, and the agreement is the only place the answer lives.

Does this include VAT?

No, and that matters. Where a management fee is quoted plus VAT, a 20% fee costs 24% of the base once VAT is added. Enter the VAT-inclusive percentage if you want the figure that actually leaves your account.

What does the tool deliberately leave out?

Everything that is not a per-booking deduction: your mortgage, insurance, utilities, council tax or business rates, repairs, consumables, and income tax. It answers one question only, which is what reaches your account from the bookings themselves.