The HMRC has told Airbnb that they could be facing legal proceedings regarding "tax laws or regulations impacting the company's business".

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Airbnb is also undergoing further proceedings and tax inquiries investigating its intra-company transactions and overall UK operations. The company has two UK firms, Airbnb UK and Airbnb Payments UK, the former is responsible for marketing the business as well as support and the latter processes all payments between guests and Airbnb hosts outside of, China, India and the US.

In 2018 although Airbnb UK had a turnover of £14.2 million, it only paid tax of £146,059 on £455,076 profits.

Last year Airbnb Payments UK made a £1.2 million profit from its total turnover of £273.2 million, and paid £234,788 tax.

An Airbnb UK spokesperson said: “We follow the rules and pay all the tax we owe in the places we do business. That is true as rules apply today and will remain true for whatever rules apply in future.

“The Airbnb model is unique and boosted the UK economy by £4.2bn last year alone. The vast majority of money generated on our platform stays with hosts and local communities, which makes Airbnb fundamentally different to companies that take large sums of money out of the places they do business.

“As with many other companies, these are routine checks and we are working closely with HMRC.”