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Welcome to the California State Sales Tax Blog!

author photo of Monika Miles

Welcome to the California state sales tax blog! I’m looking forward to sharing some of the interesting things about our sales tax rules with our readers – and letting you weigh in about whether it’s as complicated as many people think it is. While California frequently gets a bad rap about being unfriendly to business, we do have some rules that are favorable to business (including some recent changes for manufacturers), and we’ll talk about those here. California is also home to some statutes that will make you scratch your head and wonder what “they” were thinking. We’ll address some of those as well. And since my firm is headquartered in Silicon Valley, we’ll likely venture into the technology industry on occasion and talk about some issues that our readers in that sector might encounter. Stay tuned as we navigate the Golden State!

Thanks for visiting California!

Do you have questions about California (and/or multi-state) sales tax - or does your business need assistance with other tax issues? Monika welcomes inquiries from SalesTaxSupport.com users and offers a complimentary 30 minute consultation to companies with multi-state activities. Please use the "Request a Consultation" link on FIRM PROFILE page to submit your question or consultation request.

Other recent “California (CA)” posts by Monika Miles, CPA:

NOTE: All blog content, comments, and participation subject to disclaimer at bottom of page.

Comments

21 Responses to Welcome to the California State Sales Tax Blog!

  • Posted by NEIL on August 30, 2016 12:54am:

    Hello Monika - a very quick and simple question that thus doesn't seem to have a simple answer! - We are a UK entity and we are renting an event venue for a client in the US. We have a quote with 9.5% sales tax added - the client locally int he US feels we should not be charged nor have to pay local sales tax as a UK entity, with no US base nor status - and as a one off transaction and therefore our invoice to them should also not contain sales tax. Hope this makes sense - do we pay sales tax or not? - many thanks - love your blog... Neil

    • Posted by Author photo of Monika Milesmonikamiles on September 16, 2016 11:32am:

      Neil - glad you enjoy the blog!

      • Posted by Author photo of Monika Milesmonikamiles on September 16, 2016 11:35am:

        Neil - fingers quicker than I wanted! A very quick and simple question? There aren't any of those in sales tax! (Just kidding.) Need a little more information about the venue and how long you are renting it. Just because you are a UK entity, doesn't mean you don't have nexus. And even just a slight "touch" with CA often means we welcome you here - and welcome your sales tax. I'm happy to take your call offline and discuss further.

  • Posted by Carl on May 16, 2016 4:22pm:

    We are a Florida based software company. In Florida we do not need to collect sales tax for access to our software because it is considered an intangible good. Our Software is accessed from the internet. We currently have a hired a company in California to do sales for our SAAS product. Do we now have nexus in CA. Do we need to be charging sales tax? Do we need to file a State Tax Return on our California Sales? Thank you for any help you may be able to provide.

    • Posted by Author photo of Monika Milesmonikamiles on September 16, 2016 11:39am:

      Carl,
      Thanks for your question. The quick answers to your questions are as follows: yes, you do have nexus - the company engaged in sales for you creates nexus in CA. The good news is that sales of SaaS are currently non-taxable in CA. There are a couple schools of thought as to whether you register or not. If all you are selling is non-taxable items, then there's an argument for not registering. I'd want to know more about your activities in total, however, before finalizing that advise. Also, you probably know that many states DO tax the SaaS product. I do a lot of consulting in that space, so if you'd like to have a conversation about that, please connect with me via email. My latest blog (to be posted in the next day or two on this site) will cover some of that.

  • Posted by Byron on April 28, 2016 2:44pm:

    I am selling musical instruments out of California. Do I need to need to charge tax if I sell to someone in Singapore (or any foreign country)?

    • Posted by Monika on April 28, 2016 2:55pm:

      Byron,
      No. California sales tax would not apply to property shipped out of the country. Just make sure title doesn't pass here. That could present a problem.

  • Posted by Kathryn on January 12, 2016 1:52pm:

    As a small business located in San Diego, we resale items to customers all over the country. We have always charged sales tax on the taxable merchandise and remited that tax to the state of Calif. Recently, a customer said they should not be charged tax since they are in Alaska. In researching this, I have found some discussion on not charging sales tax to destination states that are not Calif. Have we been charging tax incorrectly? Should we charge different states depending on that state's tax structure? Can you please clarify?

    • Posted by Author photo of Monika Milesmonikamiles on January 28, 2016 5:50pm:

      Kathryn,
      Thanks for your question. The responsibilities for the collection of sales tax can certainly be confusing. If you are located solely in CA you only need to be collecting (and remitting to the state) sales tax on sales to CA customers. If you have a taxable presence in other states (by virtue of holding inventory, or having employees there - among other things) then you may be subject to that state's sales tax collection requirements. In the example above, you likely have 2 "outs" - you're probably not sending salespeople to Alaska, AND the state doesn't have a state sales tax. But, in general, unless you have a taxable presence in a state, you don't need to charge sales tax on items shipped to those states. I hope that helps.

  • Posted by Cindy on January 11, 2016 12:04pm:

    Our business has physical locations in both CA, NM and AZ.If our CA location takes a phone order from a AZ customer and the item is transported to AZ from CA, to be delivered to the customer in AZ, should AZ sales tax only be collected (vs state of AZ plus local tax based on customer's city in AZ)? Does any CA tax apply? Thank you

    • Posted by Author photo of Monika Milesmonikamiles on January 28, 2016 6:06pm:

      Cindy,
      Thanks for your question. As is often the case, the answer is likely to be more complicated than you were hoping for. First, to clarify, in AZ, we're talking about Transaction Privilege Tax or "TPT" (which is like sales tax, with a different name). The Arizona Department of Revenue will help coordinate collection of the tax on behalf of the county and most cities; however, many of the larger cities in Arizona administer and collect their own privilege taxes. These cities are referred to as non-program cities. Sales in the non-program cities must be reported directly to the applicable city - and require additional filing. The state and county taxes must still be reported and remitted to the state. A list of the non-program cities along with their contact information is available on the Arizona Department of Revenue website. So, you need to know in which cities you operate, and then into which AZ cities you sell. That'll determine the amount of TPT you collect. In your scenario, no CA sales tax would apply because the sale is made to an AZ customer.

  • Posted by Debbie on March 17, 2015 11:26am:

    I own a small interior design studio and furniture store in Washington State. I have a client in California who is purchasing some special order items from me to be delivered to her in CA. I'm not sure how to handle the sales tax issue for these items.
    Any information will be greatly appreciated.
    Thank you.

    • Posted by Author photo of Monika MilesMonika Miles, CPA on April 7, 2015 6:45pm:

      Debbie,
      Thanks for your query. First, we need to know whether you have nexus, or taxable presence in California. Do you have employees in CA, or regularly send employees there? Do you use independent contractors in CA? How do you deliver the products - in your own trucks or by common carrier? Do you maintain any inventory here? If not (and if there are no other factors which give you nexus), you may not have to deal with CA sales tax at all. However, sales tax is very facts and circumstances driven, so this answer is based only on the facts presented above. Happy to get a few more facts from you to get it correct. Feel free to contact me at monika@milesconsultinggroup.com

  • Posted by Jim on February 10, 2015 8:10am:

    We are a beverage manufacturer and purchase various ingredients and packaging materials to make the final product. In the past we would submit to our vendors a resale cert marked Food Manufacturer. Now for some vendors we are asked to provide a resale number which to my knowledge we do not have. Has the law changed? Is there a number we need to provide? We do not sell our finished product directly to any consumer.

    • Posted by Author photo of Monika MilesMonika Miles, CPA on February 19, 2015 6:27pm:

      Jim, Are you registered as a retailer in CA at all? Even though you might be doing all your sales for resale, you would generally still have a seller's permit if you are doing business in CA. A properly executed resale certificate generally requires the seller's permit number (if required to have one).

  • Posted by TC on November 13, 2014 3:29pm:

    Hi Monika,
    We're building an Adobe BC site for a client in Southern California. Their website company is a DBA of their main company based in So-Cal; therefore their DBA has to pay State & special district taxes anywhere that their main company does business in CA. Are there any existing API's that will integrate with the BC site? Or companies that can assist with this tax issue? We'd appreciate any help or insight you can offer.
    Thanks,
    TC

    • Posted by Author photo of Monika MilesMonika Miles, CPA on January 12, 2015 5:02pm:

      TC,
      I apologize for the late response. And unfortunately, I don't have a good answer for you at this point as I don't know all of your facts. Have you spoken with Avalara? They are a company that assists with sales tax compliance. They may be able to assist. Again, my apologies for the late response. If you still have the issue, I'm happy to make a connection for you.

  • Posted by Beverly on November 12, 2014 9:46am:

    I have a question. If I live in Tax Free state and sell a manuscript to California production and paid by that state company, do I have to pay California state tax on thie income?

    • Posted by Author photo of Monika MilesMonika Miles, CPA on January 12, 2015 5:07pm:

      Beverly,
      My apologies for the late response. I realized this question has been out here quite a while. Your taxability in California will depend on whether you have nexus, or taxable presence here in CA. Although you may live in another state, if you do business here (i.e.; you travel here regularly for business, or have employees or independent contractors working on your behalf here), you may be required to file - both for income tax and sales tax. If you simply sell something into CA, but don't have nexus here, you generally do not have to pay CA tax. However, state tax is very facts and circumstances driven, so this is a general answer without knowing all of your facts. I'd need more facts to provide you a definitive answer. Thanks for your question.

  • Posted by Debbie on November 11, 2014 8:30am:

    There are various exempt certificates available in CA, i.e. BOE 230, 230M, MTC (resale). What are the expiration dates for these forms?

    • Posted by Author photo of Monika MilesMonika Miles, CPA on January 12, 2015 5:11pm:

      Hi Debbie,
      My apologies for the late response on your question. Most exemption certificates don't have an expiration date, per se. However, we recommend to our clients that they keep them current within a year. It's good policy to check your facts with your customers at least annually to make sure that goods are still being resold (for resale certs) and that you can still accept the certificate in good faith. Coincidentally, my upcoming blog post in this space is about CA resale certificates. Please check it out and if you have further questions, please drop me another line. I promise to get back to it quicker this time! Thanks for your question.

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