Thinking about renting out a home or condominium as a vacation rental? In Hawaiʻi, short-term rental income can come with additional tax responsibilities that property owners should understand before getting started.

Hawaiʻi generally treats rentals of less than 180 consecutive days as transient accommodations. Rental income from Hawaiʻi real property is subject to Hawaiʻi income tax and General Excise Tax (GET), and when the property is operated as a transient accommodation, Transient Accommodations Tax (TAT) also applies.

What Should Vacation Rental Owners Know?

  • Rental income is taxable. Income received from renting Hawaiʻi real property must be reported on the appropriate Hawaiʻi income tax return. This applies to both long-term and short-term rental activity.

  • General Excise Tax (GET) applies. Hawaiʻi's State GET rate is 4%. For properties located on the Big Island, Hawaiʻi County currently imposes an additional 0.5% county surcharge, resulting in a combined GET tax rate of 4.5%. If the tax is visibly passed on to the renter, the maximum pass-on rate in Hawaiʻi County is currently 4.712%.

  • Transient Accommodations Tax (TAT) applies to short-term rentals. Hawaiʻi's State TAT is currently 10.25% on taxable gross rental proceeds for transient accommodations. In addition, Hawaiʻi County imposes its own 3% Hawaiʻi County Transient Accommodations Tax (HCTAT). This means qualifying Big Island transient accommodations may be subject to both the 10.25% State TAT and 3% County TAT.

  • GET and TAT are separate taxes. Vacation rental owners should be aware that GET and TAT have different requirements and should not be treated as a single tax. Depending on the rental activity, both may apply in addition to Hawaiʻi income tax.

  • Registration and tax filings are required. Operators of short-term rentals generally must register for GET and TAT licenses with the Hawaiʻi Department of Taxation and file the required periodic and annual tax returns.

  • County regulations also matter. Taxes are only one part of operating a vacation rental. Hawaiʻi County has its own rules governing short-term vacation rentals, and zoning, registration, permitting, and other operational requirements may apply depending on the property and its location.

Current Big Island Vacation Rental Tax Rates

As of October 2026, the key rates include:

State GET: 4%
Hawaiʻi County GET Surcharge: 0.5%
State TAT: 10.25%
Hawaiʻi County TAT (HCTAT): 3%

Tax rates and regulations are subject to change. Property owners should verify current requirements with the Hawaiʻi Department of Taxation, Hawaiʻi County, and a qualified tax professional.

If you're considering purchasing a property as a vacation rental, understanding the tax and regulatory requirements before you buy can help you more accurately estimate the property's potential expenses, responsibilities, and overall investment.

For more information:
Hawaiʻi Department of Taxation – Renting Residential Real Property

This article is for general informational purposes only and is not tax, legal, or financial advice. Tax obligations and short-term rental regulations can vary depending on the property and how it is used. Please consult the Hawaiʻi Department of Taxation and the applicable county authorities for current requirements.