Have you been paying your use tax?
When you are located in California and you buy something from outside of California (for example via the internet) that would have been subject to sales tax if purchased within California, you may think – cool – I avoided California sales tax! No such luck! Such purchases are subject to California “use tax” – which is the same rate as what sales tax would have been if you had bought the thing in California.
Since many of us do not pay this tax, the state legislature adopted Assembly Bill x4-18 (Stats. 2009, Ch. 16) which requires “qualified purchasers” to register with the BOE and report and pay use tax.
A “qualified purchaser” means a business that meets all of the following conditions:
- Receives at least $100,000 in gross receipts from business operations per calendar year.
- Not required to hold a seller’s permit or certificate of registration for use tax.
- Not a holder of a use tax direct payment permit.
- Not otherwise registered with the BOE to report use tax.
A qualified purchaser may register for a use tax account by completing the BOE-404-A, Use Tax Registration, and mailing it to the BOE,
Board of Equalization
Tax Source Group, MIC: 007
PO Box 942879
Sacramento, Ca 94279-0007
There is no fee to register.
For more information, click here.
Related posts:
