Transient Occupancy Tax (TOT)

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Hotels and Short-Term Rentals

The Revenue Services Division administers the collection of Transient Occupancy Tax (TOT) from Hotels, Motels, and Short-term Rental Operators in the City. The authority to levy TOT is granted to the legislative bodies of both cities and counties by California Revenue and Taxation Code 7280.

Manhattan Beach Municipal Code Section 8.20 requires operators of lodging establishments to levy, collect, and remit the City's fourteen percent (14%) Transient Occupancy Tax (TOT) from those renting the lodging:

For the privilege of occupancy in any hotel, each transient shall be subject to and shall pay a tax in the amount of fourteen percent (14%) of the rent charged by the operator. Such tax shall constitute a debt owed by the transient to the City which debt shall be extinguished only by payment to the operator or to the City. The transient shall pay the tax to the operator of the hotel at the time the rent is paid. (MBMC 8.20.020).

"Transient" shall mean any individual who exercises occupancy or is entitled to occupancy by reason of concession, permit, right of access, license, or other agreement for a consecutive period of thirty (30) days or less. Should the tenancy of any individual at a "Hotel" as defined above exceed thirty (30) days, the tax shall be imposed on the first thirty (30) days of said tenancy, but shall cease being imposed on the thirty-first (31st) consecutive day and for every consecutive day of tenancy thereafter (MBMC 8.20.010D).

**Effective July 1, 2023, the TOT rate increased to 14% per Ordinance No. 23-0007 adopted by the City Council on April 4, 2023.

Below are the TOT remittance forms required when operating a Hotel or Short-term Rental:

For additional information please contact the Finance Department at (310) 802-5559.

Short-Term Vacation Rentals are now allowed within the Coastal Zone:

On April 4, 2022, the Court of Appeal issued an opinion that the City's ban of short-term rentals does not apply to properties within the Coastal Zone. Short-term rentals are still banned outside of the Coastal Zone. For more information, please visit Short-Term Rentals webpage.

Questions on Short-Term Rentals? Please See FAQs Below

1. WHAT IS A SHORT-TERM RENTAL?

2. WHAT IS TRANSIENT OCCUPANCY TAX?

3. WHERE ARE SHORT-TERM VACATION RENTALS ALLOWED IN MANHATTAN BEACH?

4. HOW CAN I REGISTER TO OPERATE AS A SHORT-TERM RENTAL IN MANHATTAN BEACH?

Operators must obtain a Business License from the City’s Revenue Services Division before starting operations. This involves completing a Business License Tax Application and Zoning Business Review Form.

Completed applications may be directed to the Revenue Services Division by:

By Email: revenue@manhattanbeach.gov
By Phone: (310) 802-5559
In Person at City Hall, located at1400 Highland Avenue, Manhattan Beach, CA 90266

5. HOW DO I SUBMIT THE TOT PAYMENT AND WHEN IS IT DUE?

The TOT Remittance Form and payment must be submitted on a monthly basis and is due on the 20^th of every month for the prior month. A 10% late penalty may be applied to payments received after the 20^th.

The TOT Remittance Form and payment may be submitted by either:

Visiting Finance Counter in City Hall
- Open Monday to Thursday 8:00 AM to 5:00 PM; Friday 8:00 AM to 4:00 PM
- Closed on City recognized holidays
By Mail - Send a check payable to “City of Manhattan Beach” to the address below:
- City of Manhattan Beach
  ATTN: Revenue Division
  1400 Highland Avenue
  Manhattan Beach, CA 90266

6. DO I STILL NEED TO SUBMIT THE MONTHLY TOT REMITTANCE FORM EVEN IF I HAVE NO RENTALS TO REPORT?

7. HOW DO I CALCULATE THE TOT PAYMENT DUE? WHAT IS INCLUDED? WHAT IN NOT INCLUDED?

Complete all fields of the TOT Remittance Form and enter Gross Rent Received for Short-term Rental.
Items that should be included in “Rent” reported that are commonly overlooked include, but are not limited to room occupancy fees, cleaning fees, extra person charges, pet fees, cancellation fees, and Wi-Fi Access Fees.
Online hosting platforms (e.g. Airbnb, VRBO, Flipkey, etc.) are web-based booking sites that facilitate reservations and payments for Short-term Rentals. Host Platform Fees should not be factored for purposes of assessing TOT. The simplest way to calculate the 14% TOT due to the City is to base it on the Host Payout you receive from the online travel sites.
Hosts are responsible for collecting TOT taxes from guests and remitting them to the City. Please ensure proper tax collection settings are selected when listing a short-term rental. For more information, please see resources below:
- Airbnb
  - Host should turn on “Manual Collection” (platform collects TOT for you)
  - Visit: https://www.airbnb.com/help/article/2496
- Vrbo
  - Host should select option to “Collect my taxes and send them to me”
  - Visit https://help.vrbo.com/articles/How-can-I-manage-my-lodging-taxes
- Flipkey
  - Visit https://helpcenter.flipkey.com/articles/FAQ/What-do-I-need-to-know-about-vacation-rental-regulations

8. WHAT IF I HAVE A GUEST RESERVATION THAT IS SPLIT IN BETWEEN TWO MONTHS?

9. ARE THERE ANY EXEMPTIONS FROM TOT?

10. WHAT IF I USE MY RENTAL FOR A LONG-TERM LEASE?

Any long-term lease in which the rental is leased for 31 or more consecutive days is not considered a short-term rental, and therefore, is not subject to the TOT taxes.

If transitioning from a short-term rental to a long-term rental, then documentation of the long-term lease must be provided to the City. In this scenario, the monthly TOT Remittance Form does not need to be submitted during the long-term lease.

11. WHAT ARE MY RESPONSIBILITIES AS AN OPERATOR TO DOCUMENT AND COLLECT TOT?

To collect the 14% T.O.T - Per MBMC 8.20.040, each operator shall collect the TOT at the same time as the rent is collected from every transient.
To maintain record keeping for 3 years – Per MBMC 8.20.100, each operator shall keep and preserve, for a period of three (3) years, all TOT records as may be necessary to determine the amount of such tax, which records the City shall have the right to inspect at all reasonable times.

12. WHAT HAPPENS IF I OPERATE A SHORT-TERM VACATION RENTAL WITHOUT A BUSINESS LICENSE OR ILLEGALLY (NOT WITHIN THE COASTAL ZONE)?

Operating without a Business License: The City of Manhattan Beach does not allow the operation or advertising of a short-term vacation rental without a current business license. Failure to obtain a business license would result in Administrative Citations as follows:
- $250 – 1^st citation
- $500 – 2^nd citation
- $1,000 – 3^rd citation

Operating illegally not within the Coastal Zone: if the property is illegally operating as a short-term rental outside the Coastal Zone, the owner/operator are subject to daily fines as follows:
- $250 – 1st citation
- $500 – 2nd citation
- $1,000 – 3rd citation and any additional citation (fines imposed per day)
Reporting illegally operated short-term vacation rentals: To report an illegally operated short-term vacation rental, please email or call the City’s Code Enforcement Division at code@manhattanbeach.gov or (310) 802-5518. Please include the following information when reporting short-term vacation rentals: address, photos, time of observations, and any other pertinent information that may assist Code Enforcement staff.

13. WHO CAN I CONTACT IF I HAVE ANY QUESTIONS? WHERE CAN I FIND MORE INFORMATION ON SHORT-TERM RENTALS?