LicensedRental

Knox County, Tennessee

Knoxville, TN vacation rental requirements

Knoxville requires a yearly short-term rental permit from the Business License & Tax Office. In residential zones only owner-occupied homes qualify (Type 1, $70, one per owner); non-owner-occupied rentals (Type 2, $120, two per operator) are limited to non-residential districts such as downtown. Occupancy is capped at 12 and tax is 18.25%.

Checked against official sources November 5, 2026

Download checklist (PDF)Free. A printable version of this guide to tick off, with the official sources.

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Residential zones
Owner-occupied only (Type 1)
Your principal residence, proved by two documents; one Type 1 permit per person.Source
Other zones
Non-owner-occupied (Type 2)
Non-residential districts such as TC-1, C-2, Cumberland Avenue, and South Waterfront (except SW-1); two permits per person or entity.Source
Fees
$70 (Type 1), $120 (Type 2)
$50 renewal, due 14 business days before expiration.Source
Maximum guests
2 per bedroom + 2, up to 12
Taxes
18.25%
9.25% sales + 4% city + 5% county occupancy tax.Source

Type 1 permits end when the property is sold.

Your licensing checklist

In order: the state, the county, then the town.

State of Tennessee

  1. Register for sales tax

    Register through the Tennessee Taxpayer Access Point (TNTAP). One registration covers all your rentals in the same city or county. If you take direct bookings, collect 7% plus the local rate and file by the 20th of each month. Once registered, file every month, even a $0 return.Source

    TNTAP →

  2. Get a business tax license

    Rentals under 180 days owe business tax. With $3,000 to $100,000 a year in gross receipts in a city or county you need a minimal activity license; at $100,000 or more, a standard license. Booking platforms don’t handle this for you.Source

  3. Know what the platform collects

    Airbnb, VRBO, and other marketplaces collect and remit sales tax and local occupancy tax on their bookings. Keep records showing they did. For direct bookings, you pay sales tax to the state and occupancy tax to the city or county.Source

  4. Then your county and city

    Permits, zoning, and occupancy tax rates are where Tennessee towns differ most. Pick your area.

Knox County, Tennessee

  1. Then your city or area

    Pick your area.

City of Knoxville

  1. Apply to the Business License & Tax Office

    Include proof of ownership (and residency for Type 1), a site plan and floor plan showing bedrooms and off-street parking, a local contact, an indemnification agreement, and an affidavit of life-safety equipment. The office decides within 14 business days of a complete application.Source

    Knoxville short-term rentals →

  2. Notify neighbors (Type 1)

    Within 48 hours of applying, mail or hand-deliver the city’s notice to adjoining owners (including across and diagonally across the street) and any neighborhood organization, and give the city their names and addresses.Source

  3. Put the permit number in every ad

    Advertising a rental without its permit number is unlawful; operating without a permit is $50 a day.Source

  4. Register for sales and occupancy tax

    Tax on stays here is 9.25% sales tax plus 4% city and 5% county occupancy tax. Airbnb and VRBO collect both on their bookings. For direct bookings, file sales tax with the state through TNTAP by the 20th of each month. File the city’s hotel occupancy tax with the City of Knoxville and the county tax with the Knox County Clerk. You may also need city and county business licenses.Source

Inspection checklist

What the inspector looks for, from City of Knoxville’s published checklist.

  • Smoke alarms (UL 217)In each sleeping room, within 15 feet outside sleeping rooms, and on every story including basements.Source
  • Carbon monoxide detectorWithin 15 feet of all bedrooms.Source
  • Fire extinguisherAt least one, operational.Source

House rules for guests

Local contact
On site within 45 minutes, 24/7
Source

Sources

A plain-language summary to help you prepare, not legal advice. Rules and fees change; confirm with the office before you apply. Spot something out of date? Email hello@licensedrental.com.