How sales tax applies to Washington timeshare agreements
Timeshare stays at lodging facilities are subject to state sales tax and lodging taxes.
Timeshare agreements give a person membership and the right to use lodging facilities in exchange for fees. Members can also exchange a stay at one timeshare for a stay in a different timeshare. Members purchase and use points, credits, weeks, etc. (collectively referred to as “points”). Points can be exchanged for the use of lodging facilities. Timeshares are also known as vacation clubs.
Transient Use applies when someone stays at a lodging facility for less than 30 days in a row.
Lodging taxes include Special Hotel/Motel Tax, Convention and Trade Center Tax and Tourism Promotion Area Charges. See our Lodging Guide for more information on when these taxes apply.
Using timeshare lodging facilities in Washington
When consumers (members or non-members of a timeshare agreement) use lodging facilities on a transient use basis, they owe retail sales tax and any applicable lodging taxes. It doesn’t matter if the person using the lodging facility prepaid with points through a timeshare operator. It also doesn’t matter if the user is a Washington resident, or a resident of another state or country. (This assumes that the person using the facility does not have an ownership interest in that facility.)
The taxable amount
The taxable amount comes from comparing the timeshare’s value to a similar unit’s value during the same time of year. When a timeshare member redeems points to stay at a Washington facility, the taxable amount is the value of those points. When a non-member purchases lodging at a Washington facility, the taxable amount is the charge to the non-member.
Housekeeping charges from transient lodging services are subject to retail sales tax and any applicable lodging taxes.
Additional charges may also be subject to sales tax and lodging taxes. See our Lodging Guide for more information.