Hawaii Airbnb and Short Term Rental Regulations (2025 Update)

Hawaii’s stunning beaches, vibrant culture, and year-round tropical climate have long cemented its reputation as a dream destination for travelers worldwide. These same factors also make the Aloha State an attractive market for short-term rental investments, as visitors frequently seek unique stays across the islands. However, Hawaii’s robust tourism industry has led state and county authorities to enact laws that balance economic opportunities with maintaining local communities’ integrity. This article outlines the current landscape of Hawaii’s short-term rental regulations, how to start a vacation rental business, and the taxes owners must prepare to handle.

Hawaii’s Definition of a Short-Term Rental

Hawaii does not impose a single statewide definition for “short-term rentals,” but most county regulations treat any stay of less than 30 days as transient lodging. The state constitution grants each county (Oahu/Honolulu, Maui, Kauai, and Hawaii Island) significant autonomy in regulating zoning and tourism. As a result, the criteria and rules can vary among islands. Some localities require a minimum stay of 30 days unless the owner obtains a special permit, while others have introduced district-specific vacation rental caps or bans. Before listing a property on Airbnb or Vrbo, property owners should verify the precise cutoff and rules in their county.

Starting a Short-Term Rental Business in Hawaii

Launching a short-term rental in Hawaii involves navigating both state tax rules and county-level vacation rental ordinances. Although Hawaii does not mandate a single, statewide short-term rental license, owners typically need to:

1. Register for tax purposes with the State of Hawaii Department of Taxation.
2. Confirm whether their county requires a vacation rental permit or land-use approval for operating in certain zones.
3. Adhere to any restrictions on the number of nights rented, occupancy limits, or parking guidelines.

Additionally, some communities or homeowners associations have even stricter policies that can affect whether you can legally offer your property as a short-term rental. Given the potential for ongoing legislative updates, checking official county websites or consulting local agencies is crucial.

Short-Term Rental Licensing Requirement in Hawaii

Hawaii does not provide a single state short-term rental permit, but hosts must satisfy each island’s licensing or permitting requirements:

• Oahu (City & County of Honolulu) has recently adopted regulations limiting the areas where short-term rentals under 30 days can legally operate. Permits are issued to certain “resort-zoned” properties or a small number of approved “transient vacation units.”
• Maui County requires owners of short-term rental homes (STRH) or bed-and-breakfasts (B&B) to obtain a county permit. There may be caps on the number of active permits within specific districts.
• Kauai enforces “Transient Vacation Rental” (TVR) regulations. Properties outside designated zones often need non-conforming use certificates or special permits.
• Hawaii Island (Big Island) restricts short-term rentals to certain areas or properties that have received official registration.

Owners who bypass these county-level regulations risk fines or forced closure. The nuances are significant, so checking each county’s Planning Department website or speaking with local officials can save time and money.

Hawaii Short-Term Rental Taxes

Hawaii’s tourism-driven economy means that multiple taxes typically apply to short-term rentals:

• General Excise Tax (GET): Hawaii levies a GET on most business activities, including rental income. The base rate is 4%, with counties often adding a 0.5% surcharge, resulting in 4.5% in many areas.
• Transient Accommodations Tax (TAT): Often referred to as the “hotel tax,” the TAT applies to any rental of less than 180 days. The state portion has historically been around 10.25%, though recent legislative changes allow counties to add their own TAT surcharge of up to 3%.
• County-Specific Surcharges: As counties gain authority to add surcharges to the TAT, combined rates can rise above 13%. If your booking platform does not automatically collect and remit these taxes for you, you must register with the Department of Taxation and file returns on the appropriate schedule.

Maintaining accurate records of rental income and fees is essential for timely filings. Failure to comply with Hawaii’s tax requirements can lead to penalties and interest charges.

Vacation Rental Tax Deductions

Short-term rental owners in Hawaii may benefit from a variety of tax deductions if they rent out their properties for more than 14 days annually. Common deductible expenses include mortgage interest, property taxes, maintenance, insurance, utilities, and depreciation of the home and its furnishings. Because Hawaii’s property values and associated costs are often higher than on the mainland, these deductions can substantially impact an owner’s bottom line. It’s best to keep detailed records and stay updated on federal and state tax guidelines to ensure compliance and maximize your deductions.

Short-Term Rental Regulations by Major Locations in Hawaii

Oahu (Honolulu)

Honolulu restricts short-term rentals to designated resort zones or certain properties with non-conforming use certificates. Recent ordinances require owners to secure a permit for rentals fewer than 30 days, and advertisements must display a registration number. Fines for unpermitted rentals can be significant, exceeding $10,000 if violations persist.

Maui

In Maui County, properties intended for short-term use typically need a Short-Term Rental Home (STRH) permit or a Bed-and-Breakfast (B&B) permit, depending on the scenario. The county enforces limits on how many such permits are granted in each community plan area. In addition to GET and TAT, there may be a local property tax classification for short-term rentals, which can be higher than residential rates.

Kauai

Kauai is known for its strict approach to vacation rentals, primarily allowing them in Visitor Destination Areas (VDAs). Rentals outside these zones must have a Non-Conforming Use (NCU) certificate to legally operate. The county actively monitors listings for compliance, and owners who violate land-use regulations risk heavy fines or license revocation.

Hawaii Island (Big Island)

Hawaii Island requires vacation rentals in areas not zoned for resort use to register as a Short-Term Vacation Rental (STVR). Properties within designated resort zones may face fewer restrictions, but owners still need to pay GET and TAT. Local authorities often conduct inspections to confirm that the rental meets health and safety standards.

Takeaway

Hawaii’s popularity among travelers translates into significant opportunity for short-term rental investors. Yet the state’s robust regulatory framework—split across four counties—requires owners to pay close attention to laws regarding permits, zoning, and taxes. Complying with each island’s unique requirements is crucial to avoid fines, legal action, or forced shutdowns.

Anyone aiming to start an Airbnb or vacation rental business in Hawaii should begin by researching the relevant county regulations and applying for any necessary permits or licenses. It’s also essential to register with the Hawaii Department of Taxation to collect and remit both the General Excise Tax and the Transient Accommodations Tax. With proper planning and diligent adherence to local and state laws, short-term rental owners can benefit from Hawaii’s robust visitor market while helping preserve the islands’ cultural integrity and natural beauty.