New Mexico GRT and Short-Term Rentals

Taxes on short-term rentals in New Mexico can be confusing. There are multiple layers — state, county, and municipal — and different booking platforms handle them differently. Here’s what every Santa Fe vacation rental owner needs to know.

What Is Gross Receipts Tax (GRT)?

New Mexico uses a Gross Receipts Tax (GRT) rather than a traditional sales tax. The GRT applies to receipts from most business activities, including short-term rentals. The rate varies by location:

• State base rate: 5.125%
• Total rate (including city/county): typically 5.125% – 8.6875% depending on jurisdiction

Santa Fe City properties pay a higher combined rate than properties in unincorporated Santa Fe County. Knowing exactly which jurisdiction your property sits in matters significantly for your tax obligations.

What Airbnb Collects

Airbnb is a Marketplace Facilitator under New Mexico law. This means Airbnb automatically collects and remits GRT on your behalf. As an Airbnb host, you generally do not need to separately remit GRT on Airbnb-sourced revenue.

However, verify this is being collected correctly by reviewing your Airbnb tax summaries each year.

What VRBO Collects

VRBO similarly collects and remits municipal, county, and state GRT as a marketplace facilitator. Rentals booked through VRBO should have taxes handled at the platform level.

What Booking.com Does NOT Collect (As of 2024)

This is a critical difference: Booking.com does not act as a marketplace facilitator in New Mexico as of 2024. This means rentals booked through Booking.com require you to independently collect, report, and remit GRT to the New Mexico Taxation and Revenue Department.

If you accept Booking.com reservations, you need:

1. A New Mexico CRS (Combined Reporting System) identification number
2. Regular GRT filings (typically quarterly or monthly depending on revenue)

Lodger’s Tax

In addition to GRT, Santa Fe City imposes a Lodger’s Tax on short-term rentals. This is a separate municipal tax that funds tourism promotion. The Lodger’s Tax is generally collected by platforms like Airbnb, but confirm this in your platform’s tax settings.

Santa Fe City vs. County Classification

Your property’s jurisdiction affects both your GRT rate and your Lodger’s Tax obligations. The dividing line between Santa Fe City and Santa Fe County isn’t always obvious from an address alone. Check with the City of Santa Fe’s finance department if you’re uncertain.

Practical Recommendations

1. Register with the NM Taxation and Revenue Department — even if platforms collect most taxes on your behalf, you need a CRS number
2. Track platform-specific tax withholding — keep records of what each platform remits on your behalf
3. Consult a local tax professional — the GRT implications of a vacation rental business can be complex, especially with multiple income streams

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Tax compliance is one of the many things we handle for property owners in our co-hosting program. Schedule a free property analysis to learn more about how we manage the business side of vacation rentals.