Transient Rentals Laws in Iran

Transient Rentals Laws in Iran

Iran

Introduction
Introduction to Transient Rentals in Iran

Unlock the potential of your property and become part of the booming short-term rental market in Iran. Whether you own an apartment in bustling Tehran, a traditional house in picturesque Isfahan, or a cozy villa near the Caspian Sea, embrace the opportunity to be part of Iran’s thriving short-term rental market. Turn your property into a source of income and cultural exchange, and join a community dedicated to offering unforgettable travel experiences. Sign up today and start your journey as a successful host.

Overview

Unlock the potential of your property and become part of the booming short-term rental market in Iran. Whether you own an apartment in bustling Tehran, a traditional house in picturesque Isfahan, or a cozy villa near the Caspian Sea, embrace the opportunity to be part of Iran’s thriving short-term rental market. Turn your property into a source of income and cultural exchange, and join a community dedicated to offering unforgettable travel experiences. Sign up today and start your journey as a successful host.

Property
Overview

In Iran, there isn't a dedicated national association exclusively for short-term rental (STR) owners and operators. However, the Iran Hotel Association serves as a prominent organization within the hospitality sector, encompassing various lodging providers, including those involved in short-term rentals.

Services and Support:

  • Advocacy: Represents members’ interests to government bodies.
  • Training and Development: Offers educational programs to enhance industry skills.
  • Networking: Provides a platform for collaboration and sharing best practices.
  • Resource Access: Supplies market research, industry reports, and regulatory updates.

Membership Requirements for Non-Resident Owners: Non-residents interested in membership should:

  1. Submit an application detailing their property and operations.
  2. Verify property compliance with local standards.
  3. Pay membership fees.
  4. Provide legal documents like ownership proof.

Non-resident owners should contact the Iran Hotel Association for specific requirements and consult local experts for regulatory

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short term rentals
What is Transient Rentals in Iran?
What are short Term Rentals in the Country?

In Iran, short-term rentals are commonly referred to as "Ejareh Koutah Moddat" (اجاره کوتاه مدت), which translates directly to "short-term rental." This term is used to describe accommodations that are rented out for brief stays, typically ranging from a single night to a few weeks or months, catering mainly to tourists, business travelers, and individuals seeking temporary lodging.

Is Subletting Legal?
Is Subletting Legal in Iran?

In Iran, tenants are generally restricted from carrying out short-term rentals (STR) on properties they lease without explicit permission from the landlord. This restriction is outlined in Article 10 of the Iranian Civil Code, contractual agreements like lease contracts are binding, and subleasing or renting out the property on a short-term basis typically requires the landlord’s written consent. Tenants who conduct STRs without such consent risk legal consequences, including possible eviction, as it would be considered a violation of the lease agreement and local laws.

National Association for STR Owners
What is the maximum length of stay in Iran?
What is the maximum length of stay?

According to available information, Iran does not have a nationwide regulation setting a maximum length of stay for short-term rentals. Rental durations are generally flexible, often defined by property owners and guests on an individual basis, with stays ranging from one day to few months. In popular cities such as Tehran, Isfahan, and Shiraz, as well as in smaller cities like Behshahr, Shirgah, and Kashan, short-term rentals are offered on a daily, weekly, or monthly basis. Rental agreements in these locations typically allow hosts to set their own duration limits based on demand and property management preferences, without national restrictions on the maximum length of stay.

Is there any National Registration Requirement or Permit?

Yes, hosts in Iran do need to register their short-term rental properties, and they must obtain a permit through the Ministry of Cultural Heritage, Tourism, and Handicrafts. Here is an outline of the process based on available guidance:

1. Permit Registration Process

  • Application Submission: Hosts must apply through a government portal managed by the Ministry of Cultural Heritage, Tourism, and Handicrafts, or they can visit their local provincial office if they prefer an in-person approach.
  • Electronic Services and Transparency System: The Ministry provides electronic services that allow hosts to apply for permits, check application statuses, and track the permit’s progress through a transparency system available on their website.

2. Required Documents

Hosts generally need to submit the following:

  • Proof of Property Ownership or Lease Agreement: Showing that they have the right to operate the property as a short-term rental.
  • Identification Documents: Such as national identification and any relevant personal documents required by the ministry.
  • Compliance and Safety Certificates: This may include fire safety, building inspection certificates, and health compliance documentation to ensure the property is safe for guests.

3. Associated Fees

  • Permit Fee: A standard application fee is required, although the exact amount varies by property type and location.
  • Additional Registration Fees: Depending on the province, there might be other local fees for registration and administrative processing.

4. Approval Process and Compliance

  • Inspection: After submitting documents and paying fees, the property may need to undergo an inspection to verify compliance with local safety and hospitality standards.
  • Permit Issuance: Once approved, the Ministry grants a permit allowing the property to operate legally as a short-term rental. The host may also be required to renew the permit periodically.
Is there a need for Permission from Landlord/Local Council/Neighbors?

In Iran, operating a short-term rental involves several legal considerations:

1. Local Council Approval: Property owners are typically required to secure permits or licenses from local municipalities to operate short-term rentals legally. This process ensures compliance with zoning laws and safety standards. The application usually involves submitting property details, proof of ownership or lease, and adherence to building codes.

2. Neighbor Notification: While not universally mandated, some municipalities may require property owners to inform neighbors or obtain their consent before operating a short-term rental, especially in shared residential buildings. This measure aims to maintain community harmony and address potential concerns related to noise or increased foot traffic.

Is Short-term rental Income taxable?

In Iran, short-term rental income is subject to the following national taxes and requirements:

  1. Income Tax: Both residents and non-residents are taxed on Iran-sourced rental income. The income tax rate for rental income follows a progressive scheme:
    • Income below approximately EUR 4,090 is exempt.
    • Income between EUR 4,090 and EUR 28,600 is taxed at 10%.
    • Income exceeding EUR 28,600 is subject to a 20% tax rate.
    • Business or professional income for individuals is taxed at progressive rates, up to a maximum of 35% on income above EUR 32,500.
  2. Exemptions and Incentives:
    • Tax exemptions apply to those operating in free trade zones, less-developed regions, and cooperative societies.
    • Income from certain activities, such as those related to cooperative societies in rural or tribal areas, may be tax-exempt.
  3. Property Transfer Tax: If a short-term rental property is sold, the transaction is subject to a 5% tax on real estate transfers.
  4. VAT and Lodging-Specific Taxes: Iran does not impose a national VAT, GST, or specific lodging tax on rental income at the national level.
  5. Filing Dates: Tax filings for individuals and businesses in Iran must generally be completed by the end of the fiscal year, which is March 20. It is essential to verify exact deadlines each year with local authorities.
Is there any National Tourism Fund or Tourist Tax?

There is no specific mention of hosts being required to contribute to national tourism boards or funds, nor to collect taxes directly from guests for short-term rentals in Iran. However, general tax obligations in Iran for individuals and businesses likely apply to short-term rental income, such as:

Income Tax, Corporate Tax for Non-Residents and Withholding Taxes, Iran does not impose a national VAT, GST, or specific lodging tax on rental income at the national level.

Is there any Guest Registration and Reporting Requirement?

The Ministry of Cultural Heritage, Tourism, and Handicrafts in Iran does not explicitly state if hosts must report guest information to authorities. However, reporting requirements are common in Iran, hosts offering short-term rentals are required to register and report guest information to national authorities, including local police and immigration departments. This practice is part of the country's efforts to maintain security and monitor the movement of individuals within its borders.

Is there any National Health and Safety Requirements?

The health and safety standards for short-term rental properties in Iran are primarily governed by Iran’s general health and occupational safety laws, which emphasize safe and habitable conditions for all types of properties, including short-term rentals. Here are key elements of these standards:

- **General Health and Safety Requirements:**Properties should comply with basic safety standards, including hygiene practices and provision of adequate sanitation facilities.- Hosts should ensure access to potable water and proper waste disposal systems.- **Fire and Emergency Safety:**Properties must be equipped with fire safety measures, including fire extinguishers and emergency exits.- In higher-occupancy buildings, smoke detectors and emergency signage are often required for guest safety.- **Occupational Safety and Health (OSH) Regulations:**Iran's Labour Code applies broadly to workplace environments, with an emphasis on safe and secure conditions.- The Ministry of Health and the Ministry of Labour oversee these standards, requiring safety protocols, regular inspections, and, in larger settings, compliance with workplace hygiene standards.- **Inspection and Compliance:**Inspections for short-term rental properties may occur as part of broader safety audits, particularly in high-occupancy properties.- The Ministry of Health and Medical Education, along with the Ministry of Labour, enforces compliance with health standards to ensure the property meets set criteria for guest safety.- **Reporting and Accident Protocols:**Hosts are encouraged to report accidents and maintain a record of incidents. In cases of significant safety violations, property owners may be subject to penalties if they fail to comply with safety and health regulations.- **International Standards Alignment:**Iran’s OSH policies are aligned with International Labour Organization (ILO) standards, which underscore a safe environment for all property types, including short-term rentals.
Is there any Platform Accountability Requirement?

The Likibu platform does not outline requirements for online platforms to ensure compliance with Iran’s laws for short-term rentals, focusing instead on listing and booking options. However, platforms may need to verify that hosts have proper licenses and fulfill tax and guest reporting obligations, particularly for foreign guests. Consulting local authorities, like the Ministry of Cultural Heritage, Tourism, and Handicrafts, is recommended for full compliance.

Is there any Anti-Discrimination Law?

There is no specific mention of Iranian laws prohibiting discrimination against guests in short-term rentals. Iranian law heavily restricts freedoms related to gender, religion, and sexuality, and includes stringent controls on personal behavior and expression. Discrimination against specific groups, including religious minorities like Baha’is, LGBTQ+ individuals, and women, is legally sanctioned in various ways under Iranian law.

Therefore, while there is no explicit prohibition on discrimination against guests in short-term rentals, the broader legal framework in Iran often permits or enforces discriminatory practices, particularly based on gender, religious belief, and sexual orientation.

Is there any Data Sharing Requirements?

The provided information from the Ministry of Cultural Heritage, Tourism, and Handicrafts does not explicitly mention a mandate for short-term rental platforms to share data with national government authorities in Iran. However, as is common in many countries, there may be underlying expectations or regulations that require short-term rental platforms to comply with data-sharing for security or regulatory purposes.

Is there any National Insurance Requirement?

In Iran, hosts offering short-term rentals, known as "Ejareh Koutah Moddat," are not explicitly mandated by national law to carry liability insurance. However, obtaining such insurance is highly recommended to protect against potential risks, including property damage and guest injuries. While specific legal requirements may not be in place, the Ministry of Cultural Heritage, Tourism, and Handicrafts advises hosts to ensure their properties meet safety standards and comply with local regulations. Consulting with local authorities or legal experts can provide clarity on any regional obligations and help hosts make informed decisions regarding insurance coverage.

Is there any National Zoning law/Cultural Heritage law?

According to the UNESCO National Cultural Heritage Laws Database, Iran has several regulations to protect culturally and historically significant areas from developments that could include short-term rentals:

  1. National Heritage Protection Act (1930): This act protects immovable cultural properties by prohibiting unauthorized alterations, ensuring the conservation of historically significant sites. Any development, including short-term rentals, near or within these sites requires authorization to prevent adverse impacts.
  2. Law on the Establishment of the Iranian Cultural Heritage Organization (ICHO) (1986): This law mandates the Iranian Cultural Heritage Organization (now part of the Ministry of Cultural Heritage, Tourism, and Handicrafts) to oversee the protection and management of cultural sites. This organization regulates any commercial activities around protected areas to maintain their historical integrity.
  3. Municipality Law, Article 102: This law requires municipalities to work with the Ministry of Culture and Art to conserve ancient buildings, monuments, and public spaces. It emphasizes that any intended use, like short-term rentals, near historical sites, must align with preservation standards to ensure cultural heritage conservation.
  4. Punishment Law (1996): Chapter 9 of this law enforces penalties for the destruction of historical or cultural properties, thereby discouraging any development or rental usage that could lead to the degradation of these sites.
  5. UNESCO World Heritage Sites: Iran, a signatory of the UNESCO Convention concerning the Protection of the World Cultural and Natural Heritage (1974), commits to protecting World Heritage sites. This includes preventing inappropriate commercial use that might threaten these areas' cultural or historical value.

These regulations collectively provide a framework for protecting Iran’s culturally significant areas from activities, like short-term rentals, that could harm their historical integrity.

Is there any Environmental Regulations that affects STR?

The Iranian Department of Environment (DOE) has yet to establish specific nationwide sustainability requirements targeting short-term rentals (STRs). However, the DOE, as the principal environmental regulatory body, oversees broader environmental protection efforts that can indirectly affect STR operations. These include regulations on:

  1. Protected Areas: Iran has designated numerous national parks, natural monuments, wildlife refuges, and protected areas. Short-term rentals in these areas may face restrictions to protect natural habitats and biodiversity. Examples include Kavir and Touran National Parks.
  2. Environmental Safeguarding: The DOE enforces policies that regulate waste management, pollution, and conservation efforts. These policies may require STR owners to comply with waste reduction and recycling guidelines, particularly in ecologically sensitive areas.
  3. Convention on Wetlands: Iran is a host country of the Ramsar Convention, which promotes the conservation and wise use of wetlands. STRs located near wetlands may need to follow specific practices to minimize their environmental impact on these areas.

Is there any National Tenant Protection Law?

Iranian laws indirectly protect long-term tenants from eviction for conversion to short-term rentals. While no specific law prohibits such evictions, rental agreements generally secure tenants' stability through:

  1. Binding Rental Agreements: These define tenant and landlord rights, preventing arbitrary evictions for short-term rental conversions.
  2. Lease Stability: Long-term lease terms protect tenants from eviction without valid cause, discouraging displacement for short-term profits.
  3. Tenant Rights in Contracts: Tenants have secure tenure, meaning they can’t be evicted without legitimate reasons.
  4. Renewal Clauses: Many agreements allow tenants to renew, preventing landlords from shifting to short-term rentals immediately after a lease ends.

Overall, these provisions collectively safeguard tenants against eviction solely for the pursuit of short-term rental opportunities.

Is there any Reporting Requirements for Foreigners?

In Iran, hotels and accommodations must report foreign guests’ information, including passport details, stay duration, and contact information, to immigration authorities. This process is being modernized with an electronic registration system that replaces physical passport stamps and records all entry and exit data electronically. The system, a joint effort by immigration authorities and the tourism ministry, aims to streamline reporting and improve the visitor experience, enhancing Iran's appeal as a tourist destination.

Is there any Digital Platform Regulation Compliance?

Yes, platforms listing short-term rental properties in Iran should verify compliance with national regulations before featuring such listings. Iran has specific laws governing property rentals, including requirements for permits, licenses, and adherence to local regulations. Additionally, platforms must ensure that properties listed comply with these national regulations to avoid legal complications and potential penalties. This includes verifying the property's eligibility for rental and ensuring that all necessary licenses and approvals have been obtained. By ensuring compliance, platforms can maintain trust with users and operate within the legal framework of Iran.

Is there any Consumer Protection Law that affect STR?

The "Consumer’s Right Protection Law" in Iran, approved in 2008, is the main legislation aimed at safeguarding consumer interests, including in contracts such as short-term rentals. This law aligns with several principles from the United Nations Guidelines for Consumer Protection, ensuring the availability of essential information, fair marketing practices, and avenues for redress. Key elements include:

  1. Right to Information: Consumers must be adequately informed about the products and services they purchase, enabling informed decision-making.
  2. Right to Safety: This includes protection from products or services that may harm consumers, ensuring safe and reliable rental properties.
  3. Fair Trade and Ethical Standards: The law aims to prevent misleading practices by marketers and guarantees that consumers are treated fairly in all transactions.
  4. Redress Mechanisms: It emphasizes the need for consumers to have access to appropriate channels for complaint resolution, especially if a service does not meet promised standards.

These elements support consumer protection by holding short-term rental providers accountable to maintain safe and transparent rental practices, fulfilling national and international consumer protection standards.

Is there any Law that applies to Non-resident Owners?

In Iran, non-resident individuals face specific regulations when owning and operating short-term rental properties. Key considerations include:

Property Ownership Restrictions:

  • Licensing Requirement: Foreign nationals must obtain a license to own immovable property in Iran. The process involves submitting a statement with specific details and relevant documents to the Ministry of Foreign Affairs through an Iranian political or consular mission abroad or the local governorate where the property is located.
  • Company Ownership: An alternative approach is for foreigners to establish an Iranian company, which can be wholly owned by the foreign individual. This company can then acquire property in Iran.

Taxation on Rental Income:

  • Income Tax: Rental income generated from properties in Iran is subject to income tax. Property owners must report their rental earnings as part of their overall income on their annual tax return. The tax rate may vary based on total income and other factors such as allowable deductions and exemptions.
  • Value-Added Tax (VAT): Depending on the specifics of the rental arrangement and local regulations, VAT may be applicable to rental income. Property owners should consult with local tax authorities or a tax professional to determine if VAT applies to their short-term rental business.

Residency Requirements:

  • While there are no explicit residency requirements for owning property, obtaining the necessary licenses and complying with tax obligations may necessitate interactions with Iranian authorities, which could be more straightforward for residents.

Regulatory Compliance:

  • Non-resident property owners must ensure compliance with all local regulations, including obtaining the necessary permits and licenses to operate short-term rentals legally. This may involve registering with local municipalities and tourism authorities.

Is there any classification of STR in the country?

In Iran, short-term rentals are classified by:

  1. Duration of Stay:
    • Very Short-Term: A few days to a week for tourists.
    • Short-Term: One week to a month, ideal for extended stays.
    • Medium-Term: One to several months, often for work or relocation.
  2. Property Type:
    • Apartments and Houses: Standard options for privacy.
    • Villas: Spacious and luxurious, common in tourist areas.
    • Traditional Persian Homes: Authentic cultural experience, also known as boutique hotels.
  3. Purpose of Stay:
    • Tourism: Located in tourist zones.
    • Business: Near business hubs for professionals.
    • Medical/Educational: Near hospitals or universities for specific needs.

While not heavily regulated, hosts must generally ensure property registration and compliance with local laws.

Are there Special National Event Regulations?

During national events and holidays in Iran, additional regulations may apply to short-term rentals, or "Ejare-ye Kootah Moddat," to maintain public order and respect cultural traditions:

  1. Maximum Length of Stay: Authorities may limit stay durations during major events like Nowruz or Moharram to control visitor numbers.
  2. Stricter ID Verification: Enhanced ID checks, including passport or national ID verification, may be required, especially during religious or national holidays.
  3. Curfews: Local governments might impose curfews during specific events, and hosts are responsible for informing guests.
  4. Noise Restrictions: Strict noise controls are enforced, especially during sensitive periods like Moharram, to honor cultural and religious observances.

Hosts are advised to stay updated on local regulations during these periods to ensure compliance and a respectful environment for guests and residents.

Is there any Penalty for Violating National Rules?

The information from the Ministry of Cultural Heritage, Tourism, and Handicrafts does not specify exact penalties for non-compliance with short-term rental regulations in Iran, such as renting without a permit. However, in similar cases, penalties could potentially include:

  1. Fines: Hosts operating without permits or failing to comply with regulations may face fines determined by local authorities.
  2. Property Restrictions: Authorities might restrict the use of non-compliant properties for short-term rentals.
  3. Legal Action: Continued non-compliance could lead to more severe legal repercussions, including potential closure of the rental business.

Are there National Rules or Regulations Governing Short-Term Rentals in Iran?
Are there National Rules or Regulations Governing Short-Term Rentals in the Country?

Iran lacks specific national laws solely for short-term rentals. However, existing laws impact this activity:

  • Civil Code: Governs lease agreements (requiring written contracts).
  • Landlord and Tenant Act (1997): Provides details on landlord-tenant relationships.
  • Tourism Regulations: Apply to established hotels but may indirectly affect larger-scale short-term rentals.
  • Cultural Norms: Guest registration with authorities is common; respecting cultural norms is crucial.

Key challenges include the lack of a clear definition of "short-term rental" and inconsistent enforcement. It's recommended to have written agreements, consult legal professionals, and respect local customs.

Is there any National Tax that affects short-term rental?

In Iran, short-term rental income is subject to Income Tax.

  • 25% of gross rent is typically deductible for expenses.
  • The remaining 75% is taxed at progressive individual income tax rates.

If the rental is considered a business, different tax regulations (potentially higher rates) may apply. Some exemptions might exist for certain residential properties. Consulting a tax professional in Iran is highly recommended for accurate advice.

permits, license
Are there any Permits, Licenses, or Registrations for Transient Rentals in Iran?
Are there any Permits, Licenses, or Registrations for Short-term Rentals in the Country?

Yes, hosts in Iran do need to register their short-term rental properties, and they must obtain a permit through the Ministry of Cultural Heritage, Tourism, and Handicrafts. Here is an outline of the process based on available guidance:

1. Permit Registration Process

  • Application Submission: Hosts must apply through a government portal managed by the Ministry of Cultural Heritage, Tourism, and Handicrafts, or they can visit their local provincial office if they prefer an in-person approach.
  • Electronic Services and Transparency System: The Ministry provides electronic services that allow hosts to apply for permits, check application statuses, and track the permit’s progress through a transparency system available on their website.

2. Required Documents

Hosts generally need to submit the following:

  • Proof of Property Ownership or Lease Agreement: Showing that they have the right to operate the property as a short-term rental.
  • Identification Documents: Such as national identification and any relevant personal documents required by the ministry.
  • Compliance and Safety Certificates: This may include fire safety, building inspection certificates, and health compliance documentation to ensure the property is safe for guests.

3. Associated Fees

  • Permit Fee: A standard application fee is required, although the exact amount varies by property type and location.
  • Additional Registration Fees: Depending on the province, there might be other local fees for registration and administrative processing.

4. Approval Process and Compliance

  • Inspection: After submitting documents and paying fees, the property may need to undergo an inspection to verify compliance with local safety and hospitality standards.
  • Permit Issuance: Once approved, the Ministry grants a permit allowing the property to operate legally as a short-term rental. The host may also be required to renew the permit periodically.
Is there any National Association for Transient Rentals owners in Iran?
Is there any National Association for STR owners in the Country?

In Iran, there isn't a dedicated national association exclusively for short-term rental (STR) owners and operators. However, the Iran Hotel Association serves as a prominent organization within the hospitality sector, encompassing various lodging providers, including those involved in short-term rentals.

Services and Support:

  • Advocacy: Represents members’ interests to government bodies.
  • Training and Development: Offers educational programs to enhance industry skills.
  • Networking: Provides a platform for collaboration and sharing best practices.
  • Resource Access: Supplies market research, industry reports, and regulatory updates.

Membership Requirements for Non-Resident Owners: Non-residents interested in membership should:

  1. Submit an application detailing their property and operations.
  2. Verify property compliance with local standards.
  3. Pay membership fees.
  4. Provide legal documents like ownership proof.

Non-resident owners should contact the Iran Hotel Association for specific requirements and consult local experts for regulatory

National Association for STR Owners

Disclaimer

Lodge compliance is not a licensed tax or financial advisor. Therefore nothing in the above article should be construed as tax, legal, or financial advice. Contact your local tax office for information regarding your personal circumstance.

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