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State of Hawaii General Excise Taxes and Landlord Tenant Code for New Long Term Rental Owner’s on Kaua`i

The Real Estate Market on Kauai has been hot since the start of the Covid 19 pandemic. Many homes during the pandemic were sold to mainland buyers who were looking for a place to escape to while a lack of information and uncertainty surrounded Covid 19. As of March 25, 2022, covid 19 restrictions on Kauai have lessened, and we are on the march towards getting back to what we know as normal.

 

There is a possibility that homeowner’s whom purchased property on Kauai during the pandemic, could be planning a move back to the mainland as things there normalize too. If you fall into this category, this blog is for you.

 

Here on Kauai, if you are operating a vacation or long term rental, you need to be aware of two facts:

 

  1. You need to apply for a State of Hawaii General Excise Tax ID.
  2. You need to familiarize yourself with the State of Hawaii Landlord Tenant Code.

 


State of Hawaii General Excise Tax ID

 

Every person or entity operating a business in the State of Hawaii are required to have a GET license and file the necessary tax returns. Homeowners of vacation or long term rentals in the State of Hawaii are not exempt from this requirement, and are also required to pay the State of Hawaii General Excise Tax. You can apply and register for a GET license by completing form BB-1 and submitting it to the State of Hawaii Department of Taxation.

 

Homeowner’s and Operators of vacation or long term rentals in the State of Hawaii are subject to penalties, fines, and possible civil action, if they are caught running their rental business and not paying the State of Hawaii General Excise Tax.

 

Please click on this link for more GET information provided by the State of Hawaii website https://tax.hawaii.gov/geninfo/get/. Please click on this link for GET Tax Facts provided by the State of Hawaii https://files.hawaii.gov/tax/legal/taxfacts/tf2015-37-1.pdf. Please click on this link for general instructions for filing the GET tax returns https://files.hawaii.gov/tax/forms/2020/g45ins.pdf.

 

State of Hawaii Landlord Tenant Code

 

I am an active long term rental property manager for Kauai Dreams Realty and have been on the job for about two years. In that two years, I have found myself very often, having to familiarize homeowner’s and tenants whom I work with that there is a landlord tenant code in the State of Hawaii and that it is law. “The Hawaii Residential Landlord-Tenant Code is the name of Chapter 521, of the Hawaii Revised Statutes (HRS).” (Office of Consumer Protection, Landlord Tenant Code Highlight handbook, page 1.)

 

Please click on this link to read the SOH Landlord Tenant Code Highlight Handbook https://cca.hawaii.gov/hfic/files/2013/03/landlord-tenant-handbook.pdf.

 

The State of Hawaii Landlord Tenant code covers rental agreements, security deposits, repairs, prohibited practices, landlord obligations, tenant obligations, termination of tenancy, landlord and tenant remedies.

 

Some of my favorite conversations to have with tenants and homeowner’s are regarding repairs. I’ve heard stories of tenants whom have made emergency repairs for their home owner without compensation. I’ve also heard stories of tenants reporting repairs that need to be made for health or safety, and home owner’s turning a blind eye to the request. This is in violation of the State of Hawaii Landlord Tenant Code. Landlords do have an obligation  to ensure that their home is habitable, safe and sanitary. On the other hand, damage caused by tenants need to be reported and repaired and paid for by the tenant or damaging party.

 

Homeowner’s and tenants who familiarize themselves with the State of Hawaii landlord tenant code are learning the letter of the law as it pertains to rentals in the State, are preparing themselves for possible disagreements that may exist down the road, and will be better prepared for how to legally respond to said disagreements.

 

If you are thinking about long term renting your home, please call me, Michael-Scott Pa`awela Lindsey at (808) 634-4502. Kauai Dreams Realty Property Management would like to work with you!

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