TAX NEWS - January 2010

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Florida Sales and Use Tax

Florida Sales Tax

Each sale, admission charge, storage, or rental is taxable unless the transaction is exempt. Sales tax is added to the price of the taxable goods or service and collected from the purchaser at the time of sale. Florida's general sales tax rate is 6 percent.


Florida Use Tax

Use tax is due on the use or consumption of taxable goods or services when sales tax was not paid at the time of purchase. For example:

- If you buy a taxable item in Florida and didn't pay sales tax, you owe use tax.
- If you buy an item tax-exempt intending to resell it and then use the item in your business or for personal use, you owe use tax.
- If you buy a taxable item outside Florida and bring or have it delivered into this state and you didn't pay sales tax on the item, you owe use tax.


Discretionary Sales Surtax

Most Florida counties have a discretionary sales surtax (county tax) that applies to most transactions subject to the sales or use tax. The county surtax rate applies to a taxable item or service delivered into a county imposing a surtax. The surtax rate that applies to motor vehicles and mobile homes is determined by the home address of the purchaser. Check the rates for each county (Form DR-15DSS) in which you sell or deliver taxable goods or services.

For certain transactions, only the first $5,000 of a taxable sale or purchase is subject to the discretionary sales surtax.


How Tax Is Calculated

Sales tax and discretionary sales surtax are calculated on each taxable transaction. Florida uses a "bracket system" for calculating sales tax when the transaction falls between two whole dollar amounts. Multiply the whole dollar amount by the tax rate (6 percent plus the county surtax rate) and use the bracket system to figure the tax on the amount less than a dollar. The Department of Revenue has rate tables (Form DR-2X) to help you.


Who Must Pay Tax?

Before you begin business in Florida, you must first find out if your business activity or products used will be subject to sales or use tax. If it is, you must register to collect sales tax or pay use tax. Revenue provides a partial list of business activities that are taxable.

List of Business Activities that are TaxableSales of taxable items at retail.Repairs or alterations of tangible personal property.Rentals, leases, or licenses to use real property (for example, commercial office space, mini-warehouses, or short-term living accommodations).Rentals of short term living accommodations (for example motel/hotel rooms, beach houses, condominiums, vacation houses, travel parks, etc).Rental or lease of personal property (for example, vehicles, machinery, equipment, or other goods).Charges for admission to any place of amusement, sport, or recreation.Operating private membership clubs that provide recreational or physical fitness facilities.Manufacturing or producing goods for sale at retail.Importing goods from any state or foreign country, for sale at retail or for use in the business or for pleasure.Selling service warranty contracts.Ordering and using, on a regular basis, mail-order products on which no sales tax was charged.Operating vending or amusement machines.Providing taxable services (for example, investigative and crime protection services, interior nonresidential cleaning services, and nonresidential pest control services).

List of Business Activities that are Taxable
- Sales of taxable items at retail.
- Repairs or alterations of tangible personal property.
- Rentals, leases, or licenses to use real property (for example, commercial office space, mini-warehouses, or short-term living accommodations).
- Rentals of short term living accommodations (for example motel/hotel rooms, beach houses, condominiums, vacation houses, travel parks, etc).
- Rental or lease of personal property (for example, vehicles, machinery, equipment, or other goods).
- Charges for admission to any place of amusement, sport, or recreation.
- Operating private membership clubs that provide recreational or physical fitness facilities.
- Manufacturing or producing goods for sale at retail.
- Importing goods from any state or foreign country, for sale at retail or for use in the business or for pleasure.
- Selling service warranty contracts.
- Ordering and using, on a regular basis, mail-order products on which no sales tax was charged.
- Operating vending or amusement machines.
- Providing taxable services (for example, investigative and crime protection services, interior nonresidential cleaning services, and nonresidential pest control services).

Governments and nonprofit organizations may not have to pay sales tax.

List of Government and non-profit organizations that might not have to pay sales tax
- State, county and city governments, qualified nonprofit organizations, such as religious, charitable, scientific, educational and veteran's organizations may not be required to pay sales tax. To request an exemption, submit an Application for Consumer's Certificate of Exemption (Form DR-5).
- The federal government is exempt from collecting or paying sales tax. In addition certain religious institutions are not required to collect or remit sales tax on the sale of goods.


Registration

You can register to collect and pay sales and use tax using Florida Tax secure Internet site.

Once you are registered, we will send you a Certificate of Registration (Form DR-11), an Annual Resale Certificate for Sales Tax (Form DR-13) and tax return forms. Place the Certificate of Registration in a visible area of the business. You can use a signed copy of your current Annual Resale Certificate to buy products tax-exempt that you will resell or re-rent.


Filing and Paying Taxes

You can file and pay sales and use tax using Revenue's secure Internet site or you may buy software from an approved vendor. Before you can file and pay your taxes electronically, you must enroll in Florida Tax e-Services program. Please take time to view Florida Tax detailed electronic filing and payment information. Taxpayers who report and pay tax electronically can download a payment due date calendar. Helpful hints are available to prevent common mistakes, provide answers to common questions, and help ensure a successful filing.

Helpful HintsBefore filing, please stop and verify that you do not have multiple windows or tabs open. This may cause incorrect or multiple submissions.Do not click on "Submit Return and Payment Now" more than once. If your confirmation page does not display after several seconds, return to the menu and click on "Reprint Confirmation Page(s). If the confirmation page for the collection period you are attempting to file is listed; print and/or save for your records. If not, you should attempt your submission again.To update your e-Services profile (contact, bank account, or file and pay method) go to Update e-Services profile. Remember to print your confirmation page after you click on "Update Enrollment". Your user ID and password may have changed and will be displayed on the confirmation page.The collection allowance is 2.5 percent (.025) of the first $1,200.00 of the amount due not to exceed $30.00.You can file now and pay later! Learn about payment warehousing.The debit date is the date your payment is taken from your bank account. The debit date must be a business day and cannot be todays date. Available dates are displayed in bold black. Be sure to review all information on the final review page before submitting.Remember, you have not finished filing until you have received a confirmation number.You can cancel a submission; however, you must do so before 5:00pm ET on the same business day you filed. In order to cancel a submission; login to the website, click on "Cancel Submission(s)", click on the confirmation number that you wish to cancel, and click on "Yes" to confirm. Once a submission is cancelled, it is permanently deleted from Florida Tax database. A submission can be a return only, payment only, or return and payment.Cancelled submissions may be viewed by clicking on the "View Cancelled Submission(s)" option after logging in to the website with your user ID and password.Many of your questions can be answered by using Florida Tax website Questions and Answers database. Learn to navigate the online sales tax e-file system.

Businesses whose sales and use tax collections are less than $20,000 per year may pay and report tax using a paper Sales and Use Tax Return (Form DR-15). Revenue has detailed instructions (Form DR-15N) to help you accurately complete your return. However, we encourage all taxpayers to file and pay electronically.


Tax Due Dates

Monthly returns and payments are due on the 1st day of the month and late after the 20th day of the month following the collection period. For example, if the sale took place during January, then tax is due on the 1st of February and late after the 20th.

Quarterly returns and payments are due on the 1st and late after the 20th day of the month following the collection period. For example, if the sale took place during September, then tax is due on the 1st of October and late after the 20th.

If the 20th falls on a Saturday, Sunday, or federal or state holiday, returns are timely if postmarked on the first working day following the 20th.
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