How to Start a Short-Term Rental in San Antonio: Permit, Taxes and Rules

Starting a short-term rental in San Antonio takes paperwork before it takes marketing. The city requires a permit for each rentable unit, hotel occupancy tax has to be collected and reported every month, and if you hold the property in an LLC, that entity has its own Texas filings. Handle those in order and your listing can go live without a takedown notice from the platform or the city.

This guide covers the process in the order most owners find easiest: what to gather, how to choose your permit type, how to set up your ownership and tax accounts, and how to apply through the city. Fees and rules change, so each figure below comes with the agency page where you should confirm it before you pay.

What You Need Before You Start

Gather these items before you open the city portal. A missing document is the most common reason a San Antonio short term rental permit application stalls.

• The property address and proof that you have the right to rent it, such as a deed or a signed lease that allows short-term rental use.
• A clear answer on whether the home is owner occupied (Type 1) or not owner occupied (Type 2). Owner occupied means you live at the property. Confirm the city's definition on the Development Services Department short-term rental page before you choose.
• A certificate of liability insurance that meets the city's current minimum. The Development Services page lists the amount, and the minimum can change.
• Your business papers: a Certificate of Formation (Form 205) if you use an LLC, or an assumed name certificate if you operate as a sole proprietor.
• An Employer Identification Number (EIN) from the IRS, which you need for most tax registrations.
• A registered agent with a physical Texas street address, if you form an LLC.
• A payment card for the permit fee and any state filing fees, plus an email address you check every day, since both the city and the Comptroller send notices there.

Step 1: Choose Your Permit Type and Count Your Units

San Antonio issues two short term rental permit types. Since the June 2024 City Council increase, a Type 1 permit for an owner-occupied home costs $300, and a Type 2 permit for a property that is not owner occupied costs $450. Each permit is valid for three years.

Three rules shape everything that follows:

• Permits are non-transferable. If you sell the property, the buyer must apply for their own permit.
• Each unit needs its own permit. A home with a detached guest house, or a duplex, may need more than one permit. Confirm how the city counts units for your property before you apply.
• Pick the type that matches actual use. Do not claim owner occupancy if you do not live there. Misstating occupancy on an application is a fast route to enforcement, which is covered below.

Step 2: Set Up Your Ownership Structure

Texas does not issue or require a general state business license, so your ownership choice affects liability and paperwork, not a state permit. The city permit is the approval you need to operate. For other permits that might apply to your activity, the state's reference is the Texas Business Licenses and Permits Guide.

Option A: Form an LLC

An LLC can keep the rental property and its income separate from your personal assets, as long as you run the entity properly. Filing a Certificate of Formation (Form 205) with the Texas Secretary of State costs $300. File through SOSDirect at https://direct.sos.state.tx.us/acct/acct-login.asp. Before you file, search the name in the state's business records at https://www.sos.state.tx.us/corp/searches.shtml, or call (512) 463-5555 for preliminary availability. The name must include an organizational designation such as LLC, L.L.C., Limited Company or Limited Liability Company.

Every Texas LLC must keep a registered agent and registered office in Texas. The LLC cannot be its own registered agent. The office must be a physical street address where the agent can be served in person during business hours, so a post office box or a mail forwarding service alone does not qualify. Changing the agent or office later costs $15. If you need speed, Texas Express expedite options are available: Standard Expedite is $50 per document and typically takes two to three business days, Next Day Expedite is $500, and Same Day Expedite is $750. Those fees are in addition to the filing fee.

If your LLC will rent under a trade name that differs from its legal name, file an assumed name certificate (Form 503) with the Secretary of State for $25. Since September 1, 2019, LLCs no longer also file with the county clerk.

Option B: Operate as a Sole Proprietor

A sole proprietor does not form an entity with the state. If you rent under a name other than your own legal name, you must file an assumed name certificate with the county clerk in each county where you maintain a business office or conduct business. County clerk fees vary by county, so check with the Bexar County Clerk before you pay. A sole proprietorship does not separate your personal assets from the business, so talk with a CPA or attorney before you choose this route.

Step 3: Register With the Texas Comptroller

Get your EIN from the IRS first, then set up your state tax accounts. Texas has no state income tax and no publication requirement, but the following Comptroller filings apply to many hosts.

Franchise Tax and the Public Information Report

An LLC or corporation is subject to the Texas franchise tax, a privilege tax administered by the Texas Comptroller of Public Accounts. For the 2026 and 2027 report years, the no tax due revenue threshold is $2,650,000. If your total revenue is at or below that amount, you owe no franchise tax, but you must still file a Public Information Report each year. The report is due May 15 to the Comptroller, not the Secretary of State, and there is no annual report fee with the Secretary of State. Above the threshold, the rates are 0.375 percent for retail and wholesale, 0.75 percent for other entities, and a 0.331 percent EZ Computation rate for entities under $20 million in total revenue. Ask the Comptroller which rate applies to your entity. Sole proprietors do not file franchise tax.

Sales and Use Tax Permit

Most businesses selling taxable goods or services need a Texas sales and use tax permit. The state sales tax rate is 6.25 percent. The permit is issued at no charge and typically takes two to three weeks to process. Whether your cleaning fees, supplies or other charges are taxable is a question for the Comptroller or a CPA, so confirm it before you set your fee structure. Apply through the Comptroller's permit page at https://comptroller.texas.gov/taxes/permit/.

Hotel Occupancy Tax

Short-term stays carry layered hotel occupancy taxes. The state levies 6 percent. The city also collects the 1.75 percent Bexar County tax on top of the state tax. The city's own hotel occupancy tax is reported at 9 percent, made up of 7 percent plus a 2 percent convention center component. Rates do change, so check the City of San Antonio Finance Department hotel occupancy tax page for the current combined rate before you set your nightly price.

Short-term rentals report and pay hotel occupancy tax monthly. Set a recurring reminder for each reporting deadline.

Step 4: Buy Liability Insurance

Liability insurance is required for the permit. Confirm the current minimum on the Development Services short-term rental page, then ask your insurer one direct question: does this policy cover paid short-term stays? Many standard homeowners policies exclude or limit coverage for guest rentals, so a policy that worked for a long-term tenant may not cover a rotating group of short-stay guests. Ask for a certificate of insurance in the name of the owner or entity that holds the permit, and keep a copy in your permit file.

Step 5: Apply for Your Permit Through BuildSA

The city processes short-term rental permits through its BuildSA online portal. Portal screens change, so follow the prompts, but each application needs the same core information:

1. Create or log in to your BuildSA account and start a short-term rental permit application.
2. Enter the property address and the number of units. Each unit gets its own application.
3. Select Type 1 or Type 2 based on how the home is actually occupied.
4. Upload your insurance certificate, proof of right to rent and entity or assumed name documents.
5. Pay $300 for a Type 1 permit or $450 for a Type 2 permit for each unit.
6. Save your confirmation page and your permit number, and watch your email for the city's response.

This guide does not state a processing time for the city. Check the portal or ask the Development Services Department for current timing, and do not promise guests a check-in date until the permit number is in hand.

Step 6: Set Up Monthly Records and Tax Reporting

Build the habit before your first booking. Keep a spreadsheet or accounting file that records every reservation, the check-in and check-out dates, the nightly rate, cleaning and other fees, and the hotel occupancy tax collected on each stay. Platforms may collect and remit some taxes for you, but do not assume they cover everything. Ask each platform in writing which taxes it collects and remits, and which ones stay your responsibility.

Step 7: Publish the Listing With Your Permit Number

Enter the permit number in every listing exactly as the city issued it. Platforms must remove listings that lack a valid permit number, so a missing or mistyped number can cost you bookings even when your permit is real. Each listing for a separate unit needs that unit's own number.

Stay in Compliance: How Enforcement Works

The City Council added stronger enforcement tools to the short-term rental rules. Under the current framework, violations can lead to administrative hearings, meetings for repeat violators and permit revocation. Fine amounts are set out in the city's fact sheet, so check that document for current figures rather than relying on secondhand numbers. A revoked permit means that unit can no longer operate under that permit.

Tips and Common Mistakes to Avoid

• Listing before the permit number is issued. Platforms remove listings without a valid number, and guests who already booked may be left without a stay.
• Assuming the permit transfers at closing. Permits are non-transferable, so the buyer must apply for their own.
• Putting two units under one permit. Each unit needs its own permit, including a guest house on the same lot.
• Using a post office box as the registered agent address. A Texas LLC needs a physical Texas street address where it can be served.
• Skipping the Public Information Report. Entities under the $2,650,000 threshold still file it by May 15.
• Looking for a state business license. Texas has no general state business license, and counties license nothing beyond the sole proprietor assumed name filing. The permit that matters for your rental comes from the city.
• Ignoring HOA or deed restrictions. A city permit does not override a private restriction. Read your covenants before you buy or apply.
• Forgetting the three-year renewal. Put the expiration date on your calendar the day the permit issues.
• Pricing before you confirm the tax layers. The combined hotel occupancy tax changes what you keep from each booking, so set your rate after you confirm the current figures.

What Results to Expect

A complete application, a valid insurance certificate and a permit number on every listing may help you operate within the city's framework and lower the chance of a takedown. Owners who file monthly and keep clean records often find tax season less stressful, although results vary by property, occupancy and platform. Revenue depends on location, pricing and demand, and this guide does not predict how any particular property will perform.

Helpful Official Resources

• Texas Secretary of State: https://www.sos.state.tx.us/corp/index.shtml
• Texas Comptroller of Public Accounts: https://comptroller.texas.gov/taxes/
• Texas Small Business Development Center Network: https://www.sbdctexas.org/
• City of San Antonio Development Services Department (short-term rental page and BuildSA portal) and Finance Department (hotel occupancy tax page): search these names on the city website for the current pages.

Disclaimer: This article is informational content, not legal, tax or insurance advice. Rules, fees and rates change, so confirm current figures with the City of San Antonio, the Texas Secretary of State and the Texas Comptroller before you act. For complex situations, such as multiple properties, partnerships or questions about whether your home qualifies, consult a qualified attorney or CPA.