tax.nd.gov | salesta[email protected]
600 E. Boulevard Ave., Dept 127 | Bismarck, ND 58505-0599
Phone: 701-328-1246 | TTY: 800-366-6888
Guideline - Sales Tax: Hotels, Motels, AndGuideline - Sales Tax: Hotels, Motels, And
Lodging Facilities Lodging Facilities
North Dakota Ofce of State Tax Commissioner
Guideline - Sales Tax: Hotels, Motels, And
Lodging Facilities
Gross Receipts of Lodging accommodations
The gross receipts from the rental of accommodations at lodging facilities for less than 30 days are
subject to sales and use tax. A seller providing accommodations must have a sales and use tax
permit and is responsible for collecting and remitting the tax to the North Dakota Oce of State Tax
Commissioner. City lodging and restaurant taxes should be charged in addition to sales and use tax
when applicable based on location. See the City Lodging Tax & City Lodging and Restaurant Tax
Section in this guideline for additional information.
Examples of lodging facilities include:
Campgrounds renting cabins or campers Residential short-term rentals
Hotels Resorts
Hunting cabins Rooming houses
Man camps Trailer Camps
Motels Vacation home rentals
Examples of accommodations include:
Banquet rooms Meeting rooms
Conference rooms Sleeping rooms
Guest rooms Swimming facilities
Lodging facilities may charge a fee for additional rental items, services, or amenities related to the
rental of the accommodation. These items are subject to tax as part of the accommodation rental.
Examples of additional taxable charges and fees include:
Pet fee
Reservation fee (handling, processing, or
administrative fee)
Room damage fee
Smoking fee
Telephone access or surcharges
Transfer fee (room or date changes)
The gross receipts from a lodging facility operating a bar, café, or restaurant are subject to sales tax
and applicable city lodging and restaurant tax. For additional information on restaurants, please see the
Guideline - Restaurants at www.tax.nd.gov/salesanduse/guidelines.
Audio-visual equipment rental fees
Crib and roll-away fees
Early or late departure fees
Extra person fee
In-room safe rental fee
Microwave & refrigerator fees
No show charges
Guideline - Hotels, Motels, And Lodging Facilities
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Sales of items as a convenience to customers are also subject to sales tax. See the Guideline -
Grocery Stores, Convenience Stores, & Delicatessens for additional information at
www.tax.nd.gov/salesanduse/guidelines.
Non-Taxable Services
Services oered to customers, such as valet, laundry, and childcare services are not taxable.
Accommodations for 30 Consecutive Days or More
Lodging accommodations occupied by the same individual or individuals for a period of 30 or more
consecutive days are exempt from sales and lodging taxes. To qualify for the exemption, an individual
must maintain continuous occupancy for 30 or more consecutive days. Any break in the continuous
occupancy by that individual will cause the room charge to be subject to sales tax. The lodging facility
must keep records to verify the individual stayed for 30 or more continuous days. If tax was collected
during the rst 30 days of a continuous stay, it must be refunded to the customer once they meet the
30 consecutive day threshold.
Rooms rented for a period of 30 or more days by a company but not occupied by the same individual
for 30 continuous days or more are subject to sales tax.
Examples:
1. Individual A rents a room from a hotel for 45 consecutive days.
• The rental is exempt from sales tax and applicable city lodging or city lodging and restaurant
taxes.
• If the hotel billed weekly, the tax collected prior to the 30th consecutive day must be refunded to
Individual A.
2. Individual B rents a room for 29 days, checks out, then returns the following week to rent a room
an additional 20 days for a total of 49 days.
• Both rental charges are subject to sales tax because each stay was for less than 30
consecutive days.
3. Company ABC rents a room from a hotel for 60 consecutive days. During this time, there were
three dierent individuals who each occupied the room for 20 days.
• This rental is subject to sales tax because the room was not occupied by the same individual
for 30 consecutive days.
Businesses Providing Accommodations Solely for Employees
Businesses that provide lodging accommodations solely to house their employees, contractors, or a
contractor’s employees but not the general public are not lodging facilities. The business is not required
to collect sales tax when it charges employees for use of the room.
Any business that rents or leases lodging accommodations to the general public, including an employer
that also rents rooms to its own employees, is considered a lodging facility, and is required to collect
sales tax on all sales.
Accommodation Rentals to Governmental Agencies
Under North Dakota sales tax law, the federal government, state governments, county governments,
city governments, political subdivisions, and its agencies are exempt from the payment of sales tax for
rental accommodations.
Accommodations for a representative or employee of these entities are tax exempt when the charges
are billed to and paid by the governmental entity. Payment methods may include government
warrant, check, or a government issued credit card that is centrally billed to and paid by the issuing
governmental entity. Cash payments are always subject to tax.
If the representative or employee pays for their own lodging, the lodging accommodations are subject
to sales tax, even if the representative or employee is reimbursed by the governmental entity.
Documentation must be kept on le by the hotel, motel, or lodging facility to verify the exemption.
Documentation includes a completed Exemption Certicate for Government and Qualifying School
Lodging Accommodations, which requires a signature by the purchaser or a Certicate of Exempt
Status and a copy of the payment. See www.tax.nd.gov/forms for additional information.
Example: A high school basketball team travels for a weekend tournament. They stay overnight at a
hotel in Grand Forks, North Dakota.
The team coach presents the hotel with the school’s North Dakota Certicate of Sales Tax
Exemption and pays with a school check.
The lodging charges are tax exempt.
City Lodging Tax & City Lodging and Restaurant Tax
In addition to the state’s sales, use, and gross receipts taxes, many cities impose local taxes on lodging
accommodations, restaurant meals, and on-sale beverages. The charges for accommodations and
accommodation related items are subject to these additional taxes.
Example: Company A reserves a conference room and audio-visual equipment at Hotel 123 in
Jamestown, North Dakota for a conference.
Jamestown has a city lodging tax and a city lodging and restaurant tax.
When Hotel 123 invoices Company A for the rental of the conference room and audio-visual
equipment they will collect state sales tax, city sales tax, city lodging tax, and city lodging and
restaurant tax.
See the Guideline - Local Option Taxes by Location for a list of cities imposing city lodging tax and city
lodging and restaurant tax and the tax rates - www.tax.nd.gov/salesanduse/guidelines.
Short-term Residential Rentals
Renting a house, apartment, a portion of a home, or a room in a home for less than 30 days is a
taxable lodging rental. The homeowner is responsible for acquiring a sales and use tax permit,
collecting, and remitting the tax due on the short-term rental of their home.
Guideline - Hotels, Motels, And Lodging Facilities
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The homeowner may contract with a lodging marketplace to facilitate the rental of their home. The
homeowner is still responsible for the collection and remittance of tax unless their contract with the
lodging marketplace indicates the lodging marketplace is responsible for remitting the tax.
Examples:
1. A homeowner from Hettinger, North Dakota rents out their basement for 10 days during hunting
season.
The homeowner must obtain a sales and use tax permit.
The homeowner is responsible to collect and remit sales tax and city lodging tax on the lodging
rental.
2. A homeowner in Surrey, North Dakota contracts with a lodging marketplace to rent out their
home during the state fair. The contract with the lodging marketplace states the marketplace is
responsible for collecting and remitting sales tax on the lodging rental.
The homeowner is not required to obtain a sales and use tax permit.
The lodging marketplace will collect and remit sales tax to North Dakota.
Rooms Provided Free of Charge
When lodging facilities provide rooms free of charge to guests, the lodging facility must pay use tax on
the value of the room. The value is the lowest commercial rate oered by the lodging facility for that
particular room.
Hotel discount programs reward a frequent guest with a free stay after a certain number of previous
paid stays. Rooms provided free of charge in conjunction with a discount program are not subject to
sales and use tax.
Customer loyalty programs oer perks and rewards when a customer earns points. If a customer earns
a free room from the loyalty program and the loyalty program compensates the hotel for the room, the
hotel will remit sales tax plus any applicable city lodging and city lodging and restaurant taxes on the
compensation amount.
Purchases Subject to Sales or Use Tax
Lodging facilities are required to pay sales or use tax on purchases of equipment and supplies for their
own use. They should pay sales tax on the items at the time of purchase or remit use tax by including
the cost on the Items Subject to Use Tax line of the sales and use tax return.
Examples of taxable items include:
Registration supplies (including room
keys, registration books, and stationery)
Room furnishings
Soap
Televisions
Toilet paper
Towels
Bedding
Beds
Cleaning supplies
Drinking glasses
Furniture
Kleenex
Kitchen supplies
Laundry bags
Oce equipment and supplies
(including computer hardware
and software)
Guideline - Hotels, Motels, And Lodging Facilities
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Complimentary Items
The lodging facility is responsible for sales and use tax on complimentary items provided to guests.
This includes items provided in the guests’ rooms, such as shampoo, soap, and lotion. It also includes
items used to provide complimentary breakfasts and manager’s receptions, like drinks, soda, alcoholic
beverages, eating utensils, cups, and napkins.
A complimentary breakfast or meal is available as part of the cost a customer pays for their room.
Contact Information
If you have questions, please contact the Sales Tax Compliance Section at [email protected] or
701-328-1246.
21816
(Revised May 2022)
