OTA Commissions (Booking, Expedia): Impact on Margin and Accounting (2026)

Online travel agencies (OTAs) such as Booking.com and Expedia often generate 40 to 70 % of an independent hotel's bookings. Their commission, ranging from 15 to 25 %, is more than a cost line: recorded incorrectly, it distorts your margin, your VAT base and your reading of RevPAR. Here is the accounting and tax method to apply in 2026.

The accounting treatment depends on the OTA's contractual model.

• Agency model (most common with Booking): the guest pays the hotel directly on arrival. The OTA then invoices its commission, usually monthly. The hotel collects 100 % of the price, then pays out the commission.
• Merchant model (frequent with Expedia Collect): the OTA charges the guest, keeps its commission, then remits the net amount to the hotel. You never receive the gross amount in your bank account.

This distinction matters: in the merchant model, the temptation to record only the net transfer received is strong. That is an accounting and tax error.

The principle is non-negotiable: your revenue equals the price paid by the guest (the gross amount), not the net amount after commission. The OTA commission is a separate operating expense.

Why? Recording the net amount artificially understates your revenue, distorts your output VAT base and hides your true acquisition cost. You also lose all margin-analysis capability.

Worked example: a 100 EUR booking at 18 % commission#

For a room night sold at 100 EUR including tax (hotel VAT at 10 %), with an 18 % commission:

• Net revenue: 90.91 EUR (revenue account)
• Output VAT 10 %: 9.09 EUR
• OTA commission: 18 EUR recorded as an expense (intermediary fees account)

The gross margin after commission is 72.91 EUR excluding tax, an acquisition cost of 19.8 % of net revenue. Had you booked 82 EUR of net revenue, your output VAT and your margin would have been distorted simultaneously.

Typical entry (merchant model, 82 EUR received for 100 EUR sold):

• Debit Bank: 82 EUR
• Debit OTA commissions: 18 EUR
• Credit Services revenue: 90.91 EUR
• Credit Output VAT: 9.09 EUR

Booking (headquartered in the Netherlands) and Expedia (EU entities) invoice their commissions VAT-free to a French taxable customer. The service falls under intra-EU B2B rules: VAT is due by the customer, meaning you, through the reverse charge mechanism.

In practice, on the VAT return:

• you declare the VAT due at 20 % on the commission amount,
• you simultaneously deduct that same VAT (if you have full recovery rights),
• the operation is cash-neutral but mandatory for reporting purposes.

On an 18 EUR commission, you self-assess 3.60 EUR of output VAT and 3.60 EUR of deductible VAT. Omitting this line exposes you to a reassessment, even though the net impact is zero.

Reliable accounting rests on a three-way reconciliation, ideally monthly:

• OTA extranet (Booking statements, Expedia invoices): gross amount booked, commissions invoiced, cancellations.
• PMS / channel manager: room nights actually consumed, no-shows, rate changes.
• Bank receipts: OTA transfers (merchant model) or guest payments (agency model).

Frequent discrepancies come from cancellations not passed through, no-shows charged by the OTA but absent from the PMS, and period mismatches (booking in month N, stay in month N+1). A monthly reconciliation table prevents these gaps from accumulating until year-end.

Classic RevPAR (revenue per available room) ignores distribution cost. Net RevPAR incorporates the OTA commission and gives a real view of profitability per channel.

A hotel showing 90 EUR of RevPAR with 60 % OTA bookings at 18 % loses about 9.7 EUR per room in commissions, a net RevPAR close to 80 EUR. Tracking this acquisition cost per channel is the foundation of any distribution-mix decision.

Every commission point saved drops straight to margin. Encouraging direct booking (on-site engine, member rate, respected parity but a non-price advantage such as an upgrade) reduces OTA dependency. A realistic target for an independent hotel: bringing the OTA share from 60 % down to 40 %, which can represent several thousand euros of annual margin recovered.

For a long time, OTAs imposed a rate-parity clause: the hotel was barred from showing a lower price on any other channel, including its own site. The Macron Act of 6 August 2015 ended this practice in France. It reclassified the hotel-platform relationship as a mandate contract (articles L311-5-1 et seq. of the Tourism Code) and rendered parity clauses void.

In practice, you are free to offer a better direct rate, by phone or through a loyalty programme. This is the legal lever behind any disintermediation strategy: the platform remains a useful acquisition channel for visibility (the "shop-window effect"), but you are no longer required to align your direct prices with theirs. A member rate or a non-price advantage offered directly is now perfectly legal.

Commission is calculated on the amount actually owed by the guest, which raises two special cases:

• Free cancellation: no night is owed, so no commission. If the OTA has already billed it, a credit note must follow.
• No-show or paid cancellation: the night is billed to the guest under the conditions, and the OTA takes its commission on that amount. Revenue (706) and commission (622) are recorded as for an honoured booking.

A monthly reconciliation between OTA statements, the PMS and the bank flags commissions wrongly billed on cancelled stays, a frequent source of overpayment. Claim the credit notes: otherwise these amounts quietly erode margin.

Two distinct costs sometimes hide in the same flow. The commission rewards the platform's lead generation (account 622). Payment fees — card fees, processing-solution costs, virtual card — pay for transaction handling and are a separate charge. Lumping them together distorts the real distribution-cost analysis. In the merchant model, the platform often pays the hotel by virtual card: the bank fees on that card must be isolated, as they add to the headline commission and inflate the effective acquisition cost.

OTAs are only part of the distribution cost. Metasearch comparators — Google Hotel Ads, Trivago, Kayak — mostly work on a cost-per-click (CPC) or cost-per-acquisition (CPA) basis, and feed both direct bookings and OTAs. To steer, think in terms of total acquisition cost: add OTA commissions, metasearch budgets and booking-engine fees, related to the revenue each channel generates.

A euro spent on metasearch to capture a direct booking (with no OTA commission) can be far more profitable than an OTA booking at 18%. But without measurement, you steer blind. The right metric is acquisition cost per channel, compared to the net RevPAR it generates.

Four indicators are enough to manage distribution, tracked monthly:

• Share of each channel in revenue (direct, OTA, phone, metasearch).
• Acquisition cost per channel (commission or CPC relative to channel revenue).
• Net RevPAR per channel (revenue after distribution cost).
• Direct booking rate, the structural target to grow.

This dashboard, combined with tracking the tourist tax and hotel cost accounting, turns distribution from a cost endured into a managed margin lever.

The base commission is largely standardised, but a few levers exist. Visibility programmes (such as "Preferred Partner") raise your ranking in results in exchange for 2 to 5 extra commission points: useful at launch or in low season, costly year-round. Conversely, strong direct volume and good guest ratings strengthen your negotiating power and your organic visibility. Three principles guide the trade-off: never depend on a single channel, measure the return on commission (does the extra booking volume justify the extra cost?), and reinvest part of the commission savings into direct booking. Negotiation is therefore less about the bare rate than about the channel mix and the real value each euro of commission brings.

• Recording net revenue instead of gross: margin and VAT distorted.
• Forgetting the reverse charge on EU commissions.
• Failing to reconcile extranet, PMS and bank, causing unexplained discrepancies.
• Mixing commissions and payment fees (card fees are a separate expense).
• Ignoring net RevPAR and steering on overstated gross revenue.