Short-Term Rental Agreement (Philippines)
What Is a Short-Term Rental Agreement (Philippines)?
A Short-Term Rental Agreement in the Philippines creates a tenancy over the premises and records the agreed rent, deposit handling, permitted use and the grounds on which it may end.
Short-term vacation rentals in the Philippines are regulated under Republic Act No. 9593 (The Tourism Act of 2009) and the Department of Tourism's (DOT) Revised Accreditation Standards for Tourism Accommodation Establishments. DOT Memorandum Circular No. 2018-002 and subsequent orders require accommodation facilities — including private homes and condominium units offered for rent to tourists — to obtain DOT accreditation if they operate commercially as tourism accommodation establishments. However, enforcement of DOT accreditation requirements on individual Airbnb and online short-term rental hosts has been uneven.
Key Philippine short-term rental markets include: Boracay Island in Aklan Province (subject to additional IATF/DENR and SBMA/MTPB restrictions following the 2018 environmental closure and rehabilitation); El Nido and Coron in Palawan Province (subject to DENR and local government tourism zoning restrictions); Siargao Island in Surigao del Norte Province (subject to LGU zoning and tourism regulations); and Metro Manila urban short-term rentals catering to business travelers, BPO workers, and OFW returnees, particularly in Makati, BGC Taguig, Pasay (near NAIA), and Ortigas Center Pasig.
For condominium units offered as short-term rentals, property owners must comply with the condominium corporation's House Rules and By-Laws, which may prohibit short-term or transient use — many Philippine condominium By-Laws restrict rentals to minimum terms of one month or longer to prevent hotel-like operations in residential buildings. The condominium association may impose penalties or seek injunctive relief against unit owners operating unauthorized short-term rentals.
The legal framework governing the Short-Term Rental Agreement (Philippines) in Philippines draws on several key statutes and regulatory bodies. Under Philippine law, the Civil Code of the Philippines (Republic Act No. 386) governs contractual obligations. The Revised Corporation Code (Republic Act No. 11232) regulates corporate entities through the Securities and Exchange Commission (SEC). The Labor Code of the Philippines (Presidential Decree No. 442) and Department of Labor and Employment (DOLE) govern employment matters. The Data Privacy Act of 2012 (Republic Act No. 10173) and the National Privacy Commission (NPC) protect personal data. The Bureau of Internal Revenue (BIR) administers tax obligations under the National Internal Revenue Code. Parties executing a Short-Term Rental Agreement (Philippines) in Philippines should confirm the document reflects current law, including any amendments enacted since the original drafting date. The Rent Control Act (RA 9653) sets the foundational requirements.
When Do You Need a Short-Term Rental Agreement (Philippines)?
A Short-Term Rental Agreement in the Philippines is needed whenever a property owner offers a residential unit, vacation home, beach house, or furnished apartment for temporary occupancy to a paying guest.
A Short-Term Rental Agreement is needed when a Boracay island property owner lists a beach villa or cottage on Airbnb, Booking.com, or Agoda for nightly or weekly rentals to foreign and domestic tourists visiting the White Beach and Station 1-3 resort area, and requires a written agreement covering house rules, security deposit, and damage liability.
A Short-Term Rental Agreement is needed when a Metro Manila condominium unit owner in Makati, BGC, or Eastwood City rents their furnished unit for a minimum stay of 7-30 days to foreign executives, expatriates on assignment, or OFW families visiting the Philippines, using platforms like Airbnb or direct bookings through social media.
A Short-Term Rental Agreement is needed when an El Nido or Coron island resort property owner in Palawan Province rents a vacation bungalow, floating cottage, or private villa to tourist groups on a per-night basis, subject to DENR coastal zone regulations and Palawan Council for Sustainable Development (PCSD) environmental rules under RA 7611 (The Strategic Environmental Plan for Palawan Act).
A Short-Term Rental Agreement is needed when a Siargao Island homestay operator in General Luna, Surigao del Norte rents a surf-adjacent house or eco-lodge to surfers and adventure tourists, subject to LGU building and zoning permits and DOT accreditation requirements under RA 9593.
A Short-Term Rental Agreement is needed when a Filipino property owner abroad (OFW or diaspora member) authorizes a property manager or relative to rent their Philippine property to guests during peak holiday seasons (Holy Week, Christmas, New Year, and long weekends), and requires a standard agreement template to be used for all guest bookings.
What to Include in Your Short-Term Rental Agreement (Philippines)
A valid Short-Term Rental Agreement in the Philippines must contain the following essential elements.
Parties: Full legal name and address of the host/lessor and guest/lessee. For foreign guests, include passport number and nationality.
Property Description: Full address of the rental property, unit type (house, condominium unit, cottage, villa), number of bedrooms, and maximum occupancy.
Rental Period: Check-in date and time, check-out date and time (MM/DD/YYYY), and total number of nights or days.
Rental Rate: Nightly or total rental fee in PHP ₱, payment method (cash, online bank transfer, GCash, PayMaya, credit card), and VAT treatment.
Security Deposit: Amount in PHP ₱, conditions for retention (damage, additional guests, violation of house rules), and refund procedure and timeline.
Maximum Occupancy: Maximum number of guests permitted to stay in the property. Additional guest fees if applicable. Prohibition on parties, events, or commercial activities at the property.
House Rules: No-smoking policy (or designated smoking areas); pet policy; noise restrictions and quiet hours (especially relevant for condominium buildings regulated by LGU noise ordinances and condominium house rules); prohibition on illegal drugs under RA 9165 (Thorough Dangerous Drugs Act); compliance with IATF protocols if applicable.
Check-In / Check-Out Procedures: Key handover or smart lock code instructions, early check-in/late check-out fees, and condition inspection protocol.
Cancellation Policy: Advance notice required for full refund, partial refund, or no refund. Common Philippine short-term rental policies range from 48-hour free cancellation to non-refundable bookings.
Host's Obligations: Provision of utilities (electricity, water, internet/WiFi), clean linens and towels, functioning appliances, and amenities as described in the listing.
Guest's Liability: Guest's responsibility for damage to property, furnishings, or appliances beyond normal wear and tear, assessed at fair market replacement value.
Additional compliance elements for a Short-Term Rental Agreement (Philippines) used in Philippines include: Under Philippine law, the Civil Code of the Philippines (Republic Act No. 386) governs contractual obligations. The Revised Corporation Code (Republic Act No. 11232) regulates corporate entities through the Securities and Exchange Commission (SEC). The Labor Code of the Philippines (Presidential Decree No. 442) and Department of Labor and Employment (DOLE) govern employment matters. The Data Privacy Act of 2012 (Republic Act No. 10173) and the National Privacy Commission (NPC) protect personal data. The Bureau of Internal Revenue (BIR) administers tax obligations under the National Internal Revenue Code. Forms-legal.com provides this template as a starting point for Philippines-compliant documentation.
Frequently Asked Questions
No. Republic Act No. 9653 (The Rent Control Act of 2009) does not apply to short-term vacation rentals in the Philippines. RA 9653 covers monthly residential leases for units with monthly rent not exceeding PHP 10,000 (in Metro Manila) or PHP 5,000 (in other areas outside Metro Manila), under lease contracts entered into after the law's effectivity. Short-term vacation rentals — nightly, weekly, or stays of less than one month — are generally treated as transient accommodations rather than residential leases under RA 9653. The Rent Control Act's restrictions on rent increases (capped at 7% per year), security deposits (maximum two months), and just cause eviction requirements do not apply to vacation rental arrangements. This means short-term rental hosts in Boracay, Palawan, Siargao, and Metro Manila are free to set their own rates, cancellation policies, and terms. However, if a short-term rental arrangement evolves into a long-term month-to-month tenancy — particularly if the guest pays monthly rent and uses the unit as a primary residence — RA 9653 protections may apply, regardless of what the agreement labels the arrangement.
The Department of Tourism (DOT) technically requires DOT accreditation for accommodation establishments operating commercially in the Philippines under Republic Act No. 9593 (The Tourism Act of 2009). DOT Department Order No. 2020-001 and subsequent issuances define accommodation establishments subject to accreditation requirements, which include hotels, resorts, apartment hotels, homestays, and tourist inns. Individual Airbnb hosts and online short-term rental operators that offer their residential properties on a commercial, recurring basis fall within the definition of accommodation establishments required to register with DOT. In practice, however, enforcement of DOT accreditation requirements on individual Airbnb hosts has been limited and inconsistent. Many individual hosts operating on Airbnb, Booking.com, and similar platforms do so without formal DOT accreditation. Local government units (LGUs) — particularly in Boracay (regulated by the SBMA/MTPB), Palawan, and Siargao — have been more active in enforcing business permit and local tourism registration requirements for short-term rental operators. Hosts are advised to secure a Business Permit from the local government unit (City or Municipal Hall) where the rental property is located, even if they do not obtain DOT accreditation, to avoid closure orders or fines under the Local Government Code (RA 7160).
Short-term rental income in the Philippines is taxable. Individual hosts are required to report rental income to the Bureau of Internal Revenue (BIR) as part of their annual income tax return. Individual taxpayers may opt for the 8% flat tax on gross receipts under RA 10963 (TRAIN Law) if total gross income from business/profession does not exceed PHP 3,000,000 per year — this is often the simplest option for casual rental hosts. If gross rental income exceeds the VAT threshold (PHP 3,000,000 per year), hosts must register as VAT taxpayers and collect 12% VAT on each rental payment under Section 106 of the NIRC. Online platforms like Airbnb remit applicable withholding taxes in some jurisdictions, but hosts remain primarily responsible for their Philippine tax obligations. BIR Revenue Memorandum Circular No. 60-2020 reminded individual and corporate taxpayers that income derived from digital platforms, including online vacation rentals, must be reported. BIR Form 1701 (Annual Income Tax Return for Individuals) or BIR Form 1701A (for those opting for the 8% rate) must be filed and taxes paid on or before April 15 of the following year. Failure to register with BIR and pay taxes exposes hosts to income tax, VAT, and withholding tax assessments with 25% surcharge plus 12% annual interest under Sections 248-251 of the NIRC.
Yes. Condominium corporations in the Philippines have the authority to prohibit or restrict short-term rental operations (including Airbnb-style rentals) by unit owners within the condominium project, if the prohibition is included in the Master Deed and Declaration of Restrictions, the condominium By-Laws, or the House Rules duly adopted by the members. Under Republic Act No. 4726 (The Condominium Act), a condominium corporation may adopt reasonable House Rules and By-Laws to regulate the use of units and common areas, and these rules are binding on all registered unit owners and their tenants. Many Metro Manila condominium projects — particularly in Makati, BGC, and Eastwood City — have amended their By-Laws and House Rules to explicitly prohibit transient rentals (rentals of fewer than 30 days) following complaints from permanent residents about security concerns, noise, and the hotel-like traffic generated by short-term rental guests. A unit owner who violates a valid By-Law prohibition on short-term rentals may be assessed penalties by the condominium corporation, required to cease the rental activity, and in persistent cases, the condominium corporation may seek injunctive relief or specific performance before the Regional Trial Court. Unit buyers intending to use their units as short-term rentals should review the condominium's Master Deed, By-Laws, and House Rules carefully before purchase.
Short-term rentals in Boracay Island, Aklan Province are subject to special regulatory requirements beyond those applicable to short-term rentals in other Philippine locations, following the island's six-month closure and rehabilitation from April to October 2018 ordered by President Rodrigo Duterte. Current short-term rental operations in Boracay must comply with: Business Permit issued by the Municipality of Malay, Aklan; DOT Accreditation as a tourism accommodation establishment under RA 9593, which is more strictly enforced in Boracay than elsewhere; Boracay Inter-Agency Task Force (BIATF) clearance for accommodation establishments; DENR Environmental Compliance Certificate (ECC) for establishments meeting the threshold under the Philippine Environment Impact Assessment System (PD 1586); compliance with the Boracay Zoning Ordinance and the HLURB/DHSUD Master Development Plan for Boracay Island; and water, sewerage, and solid waste management compliance under DENR regulations. Individual Airbnb hosts and vacation rental operators in Boracay that do not have proper DOT accreditation and Malay LGU business permits may face closure, fines, and inclusion in the list of illegal tourism establishments maintained by the Tourism Infrastructure and Enterprise Zone Authority (TIEZA) under the Tourism Act.
This template is provided for informational purposes only and does not constitute legal advice. Laws vary by jurisdiction and change over time. Consult a qualified attorney for advice specific to your situation.Full disclaimer
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