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Sales Tax Updates 2023 from California Department of Tax and Fee Administration

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California Department of Tax and Fee Administration (“CDTFA”) updates and education events to help business owners successfully operate their business.

Reminder, Businesses most report taxable gross receipt including money receive from sales before deducting COGS or Labor or Expenses unless there is a specific exception provided by tax laws.

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What is Taxable Sales for Sales Tax?

Additionally, if there are additional sales charges that you chargre your customer, those additional charges are subject to sales tax. Examples of additional charges subject to sales tax are:

  • Merchant Credit Card Processing Fees charged to customer
  • COVID-19 Surcharges
  • Tourism Fees
  • Restaurant Surcharges
  • Auto Gratuity
  • Event space rental if food and beverage included in rental fee

For more info on what is taxable sales for sales-tax purposes you can review Revenue and Taxation Code (R&TC) Section 6012.

CDTFA Education Events

CDTFA offers online webinars for basics of sales and use tax, basic bookkeeping and industry specific for different types of businesses including presentations specific for:

  • Restaurant Industry
  • Construction Contractors
  • Gas Station Owners

To get a list of events and webinars Visit CDTFA Tax Education Events webpage www.cdtfa.ca.gov/seminar/

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Have Questions about your Sales Tax? We’re here to help you along the way! Schedule your CPA Meeting now.

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You’ll want to read this if you sold stocks last year

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Important: If you sold stocks or bonds last year in 2022 you will be receive an important tax document(s) starting in February 2023 (i.e. 1099-B, 1099-Div, 1099-Int, etc.) . You must bring these tax documents when you are ready to file your 2022 tax return. If you do not bring these documents it could delay your tax return filing and refund.

A broker or barter exchange must file this form for each person:

  • For whom, they sold stocks, commodities, regulated futures contracts, foreign currency contracts, forward contracts, debt instruments, options, securities futures contracts, etc., for cash,
  • Who received cash, stock, or other property from a corporation that the broker knows or has reason to know has had its stock acquired in an acquisition of control or had a substantial change in capital structure reportable on Form 8806, or
  • Who exchanged property or services through a barter exchange.

Merry Christmas For Sales Tax in California

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Merry Christmas for Sales Tax in California, Covid Style.

CDTFA Announced that Returns due between December 15, 2020, and April 30, 2021, for all but the largest taxpayers, will be extended.

Santa Claus’s CPA is coming to town 🎅

Taxpayers reporting less than $1 million in tax on a return originally due during this time frame are not required to seek an extension from CDTFA; relief will be provided automatically. 

Additionally, for these taxpayers, interest and penalties will not accrue on return amounts due, provided payments are made and returns are filed within three months of the original due date.

In recent press conferences and public announcements, for the first time EVER, the CDTFA is telling taxpayers to use sales tax money for necessary business operating expenses during this state of emergency.

This is dangerous for taxpayers who are not good with managing cash flow.

I strongly advise you to monitor and project your cash flow and PLEASE remember that the TAX is STILL DUE so make sure you communicate with the CDTFA immediately if you are in financial hardship.

You can read the full announcement at the following link.

https://www.cdtfa.ca.gov/services/covid19.htm

Reach out if you have any questions or want to talk more about this article or your business.

info@mrarrachecpa.com