Sales & Use Taxes and Tourist Development Tax
Sales & Use Taxes
Almost every Floridian who purchases, sells or provides goods and services is subject to Sales and Use Taxes. Florida sales tax is generally 6% but it can be higher depending upon additional local levies. This applies to the purchase price, admission prices, storage, and services, as well as tangible items. Use tax is similar to sales tax, although it only applies in certain situations, for instance:
- If you buy a taxable item in Florida and did not pay taxes at the time of purchase
- If you buy a taxable item outside of the state without paying taxes and have it delivered into Florida
- If you buy a tax exempt item with the intent to resell and then use it for personal or business purposes
In addition to little-known laws regarding use tax, there are also laws regarding discretionary sales surtax, which is a county tax that applies to almost all goods or services subject to regular sales tax. However, these taxes are not universal across Florida but are calculated according to the county to where the goods are shipped. Not paying sales or use taxes or the discretionary sales surtax can result in serious legal consequences including criminal sanctions. Because sales and use tax regulations are not always clear cut, it is easy to make mistakes. Consulting with us can help ensure that you meet all requirements, and minimize your tax liability by taking advantage of all exemptions.
Sales and Use Tax Questions
If you are starting a new business in Florida, it is essential that you determine whether state law requires you to collect and remit sales tax. Most businesses are required to pay sales and use tax and relatively few are exempt. Exempt from taxation are federal, state, county, and municipal governments, charities, religious groups, educational institutions, science organizations, and veterans’ institutes. If you are not sure whether you are subject to taxation or eligible for exemption, consult with us. We can help you complete tax registration with the state of Florida and also prepare and file your sales and use tax returns allowing your business to utilize all eligible exceptions, deductions, and incentives, and reap the greatest profits possible.
Tourist Development Tax
Florida law allows for a Tourist Development Tax. Individual counties may impose local option transient rental taxes on rentals or leases of accommodations in hotels, motels, apartments, rooming houses, mobile home parks, RV parks, condominiums, or timeshare resorts for a term of six months or less. The revenues may be used for capital construction of tourist-related facilities, tourist promotion, and beach and shoreline maintenance; however, the approved uses vary according to the particular levy. Depending on a county’s eligibility, the maximum tax rate varies from a minimum of 3 percent to a maximum of 6 percent. These local option taxes can be administered by the Department of Revenue or by one or more units of local government. Koontz & Parkin, CPAs can assist you with your questions and concerns about these taxes and the relevance to your situation.
Call Koontz & Parkin, CPAs for Information on Sales & Use and Tourist Development Taxes
Jo Ann M. Koontz and Marina Parkin offer a powerful combination of in-depth knowledge of tax regulations, a firm grasp of the business world, and years of experience representing clients. To schedule a consultation, call the Sarasota office of Koontz & Parkin, CPAs at 941.328.3993.