Money & tax
Lodging Tax and the 30-Day Rule: A Guide for Corporate Housing Operators
How hotel occupancy taxes treat long stays: the 30-consecutive-day exemption, written notice, continuous occupancy, places with other rules, and how to run it.
Corporate stays rarely start on the first of the month. A resident moves in on the 10th and leaves on the 18th of another month, and someone has to work out the first and last invoices. Here is how, with the numbers.
The three methods
| Method | Daily rate | Good for |
|---|---|---|
| Days in the month | Monthly rent ÷ days in that month | Exactness: the resident pays exactly for the share of that month |
| 30-day month | Monthly rent ÷ 30 | Simplicity: every month works the same way |
| 365-day year | Monthly rent × 12 ÷ 365 | A daily rate that never changes through the year |
Then multiply the daily rate by the number of nights stayed in the partial month.
Worked example: moving in
A two-bedroom rents for $3,000 a month. The resident moves in on March 10 and stays through the end of March. March has 31 days, and the resident is there from the 10th through the 31st, which is 22 nights.
| Method | Daily rate | × 22 nights | March rent |
|---|---|---|---|
| Days in the month | $3,000 ÷ 31 = $96.77 | 22 | $2,129.03 |
| 30-day month | $3,000 ÷ 30 = $100.00 | 22 | $2,200.00 |
| 365-day year | $3,000 × 12 ÷ 365 = $98.63 | 22 | $2,169.86 |
Round only at the end, so the daily rate keeps its decimals. The difference between methods here is about $71. Small on one invoice, not small across a portfolio, which is why consistency matters.
Worked example: moving out
The same resident leaves on April 18. Decide whether the move-out day counts. Corporate housing, like hotels, usually charges by the night, so the night of April 18 is not charged: the resident stays the nights of April 1 through 17, which is 17 nights. April has 30 days.
| Method | Daily rate | × 17 nights | April rent |
|---|---|---|---|
| Days in the month | $3,000 ÷ 30 = $100.00 | 17 | $1,700.00 |
| 30-day month | $3,000 ÷ 30 = $100.00 | 17 | $1,700.00 |
| 365-day year | $98.63 | 17 | $1,676.71 |
In a 30-day month the first two methods agree. They split apart in 31-day months and in February.
Nights or days?
The biggest source of disagreement is not the method, it is the count. Agree on two things and write them down:
- Does the move-in day count? Almost always yes: the resident sleeps there that night.
- Does the move-out day count? Usually no, if you bill by the night. If you bill by the day, you charge it. Either works if everyone knows which.
Other choices to make
Prorate the first month, or charge the full month. Some operators prorate every partial period. Others charge a full month regardless, or skip a short partial period and fold it into the next invoice. Corporate clients generally expect proration, so many operators set the rule per client.
When a stay starts late in the month. If a resident moves in on the 26th, some operators bill the six prorated nights together with the next full month, so the resident is not sent two invoices in a week.
Extensions. When a stay is extended, the old move-out proration no longer applies. The last invoice has to be recalculated for the new date, which is easy to miss in a spreadsheet.
Put it in the agreement
Whatever you choose, state it in your lease or occupancy agreement: the method, whether the move-out day is charged, and what happens with extensions and early departures. In Staylio, each booking carries its proration rule, so invoices follow it automatically, and extensions regenerate the charges that have not been invoiced yet.
Frequently asked questions
What is the most common way to prorate rent?
Dividing the monthly rent by the number of days in that month is the most common, because it charges exactly for the share of the month used. The 30-day method is also widespread for its simplicity.
How do I prorate rent for a move-out?
Divide the monthly rent by the days in the month (or by 30, or use the 365-day rate), then multiply by the nights the resident stays in that month. Decide in advance whether the move-out day itself is charged.
Is prorated rent required?
Not everywhere. Whether you must prorate depends on your agreement and local law. Many corporate clients expect it, so most operators prorate.