Tax on Insurers (Insurance Tax)
The insurance tax program is jointly administered by the California Department of Tax and Fee Administration (CDTFA), Board of Equalization (BOE), California Department of Insurance (CDI) and the State Controller's Office (SCO).
Insurance companies that have received authority from the California Department of Insurance (CDI) to transact insurance business in California are called admitted insurers and may be subject to as many as three insurance taxes in California.
All insurance companies are subject to tax on gross premiums. In addition, one of the schedules in the gross premiums tax return is used for the computation of retaliatory tax, which is the second tax that an insurance company may owe. A retaliatory tax is owed when an insurance company is domiciled in another state which imposes higher taxes and fees on a California-domiciled insurer for the same business.
The third insurance tax on insurance companies is ocean marine tax.
Surplus Line Brokers, who are licensed brokers that sell policies for non-admitted (non-licensed) insurance companies, also pay a tax (3.00%).
The CDTFA's responsibilities include issuing deficiency assessments, refunds, and evaluating appeals. Detailed CDTFA appeals procedures can be obtained in our publication Appeals Procedures, BOE-Publication 17. For detailed information regarding rates, please contact the CDI at 800-927-4357 or visit their website at www.insurance.ca.gov.
- Are you required to register?
- To register please contact the California Department of Insurance at 800-927-4357 or visit their website at www.insurance.ca.gov.
For detailed information regarding rates, contact the California Department of Insurance at 800-927-4357 or visit their website at www.insurance.ca.gov.
All tax returns are filed and paid with the CDI. The CDI forwards the payments to the SCO for posting to insurers' accounts. The CDI also forwards copies of tax returns to the CDTFA. From these returns, CDTFA staff prepares a schedule of tax by insurer. These schedules, which are distributed to the CDI and SCO, are considered to be the initial assessment of tax, as required by RTC § 12412.
If you have questions regarding this program or need to register with the CDTFA, please contact Special Taxes and Fees at the following address or telephone number:
Special Taxes and Fees, MIC: 88
California Department of Tax and Fee Administration
PO Box 942879
Sacramento, CA 94279-0088