Online Filing Instructions – Sales and Use Tax Return

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Total Sales (gross receipts)

Enter your total taxable and nontaxable sales for the reporting period, including lease and rental receipts. Please ensure the Total Sales entered includes the sales for all three months in the quarter, even if you have already submitted prepayments. Report all sales related to California business. You will deduct nontaxable transactions on the Nontaxable Sales (Deductions) page.

Do not adjust the gross sales on the current reporting period for an error made on a prior filed return. You must file an amended return for the prior period in which the error was made and submit. Amended returns that result in a credit balance are automatically considered a request for refund.

Notes:

  • Include all charges related to your sales, such as labor, service, and shipping and handling charges.
  • If you sold any business assets, such as fixtures and equipment, during the reporting period, you must report the sale as Sales of Fixtures and Equipment. If you are filing your final return and reporting the sale of the business assets, enter those values as Sales of Fixtures and Equipment.
  • Your Total Sales may include amounts for California sales or use taxes. If this is the case, be sure to deduct those tax amounts on the Nontaxable Sales (Deductions) page on the Sales Tax (if any) included in Total Sales line. If you do not, you will overpay tax.
  • Used Vehicle Dealers: Also include other taxable charges related to your vehicle sales (for example, document fees, smog certification fee, mandatory warranties, etc.).

If you will be claiming a credit from a prior filing period (tax reported and paid on a previous sales and use tax return), for returned merchandise, bad-debts, or cost of tax paid purchases resold prior to use, do not include those transactions in Total Sales. You will claim your credit on Schedule Q−Tax Credits (Adjustments) From Prior Periods.

Purchases Subject to Use Tax

Enter your total purchases that are subject to use tax, as explained below.

Your purchases of merchandise, equipment, and other tangible personal property are subject to use tax and must be reported if you:

  • Purchased the property from an out-of-state retailer who did not collect California use tax, or
  • Purchased the property with a resale certificate or other exemption certificate, and used the property in California for a purpose other than (1) resale or (2) demonstration, retention, or display while holding it for sale in the regular course of business.

You must also report your purchase of a vessel or aircraft if you (1) purchased it from an unlicensed retailer who did not charge tax on the transaction, and (2) used the property for a purpose other than resale as described above.

Enter the amount you paid for the property.

Notes:

  • If you paid another state's sales or use tax on your purchase, do not include the tax payment as part of your purchase price. You may be eligible for a credit for the other state's tax and will be asked on another page of the return.
  • If you are reporting property purchased with a resale certificate, report the purchase price on the tax return for the reporting period during which you first used the property in California.
  • If you are reporting property purchased from an out-of-state retailer who did not charge you for California tax, include the purchase price on your sales and use tax return for the reporting period during which the property entered California.

Sales of Fixtures and Equipment

If you are closing out your seller's permit and have sold fixtures and equipment, you should report the sales price as Sales of Fixtures and Equipment on your final sales and use tax return.

You must also report any inventory you intend to retain for your own use or for use as a gift, that was purchased for resale without the payment of tax or tax reimbursement, as Purchases Subject to Use Tax on your final sales and use tax return.

Sales of inventory to another retailer or to the purchaser of your business, for purposes of resale are not taxable. This amount should be reported as Sales to other Retailers for Resale on the Nontaxable Sales (Deduction) page. A resale certificate should be obtained from the buyer and saved in your records. For more detailed information, see Publication 74, Closing Out Your Account.

Helpful Links

Sales to Other Retailers for Resale

Enter your total sales to other sellers who submitted resale certificates to you for their purchases.

In general, you can accept resale certificates from other sellers who are buying property to resell in the regular course of business. If you obtain a timely and valid resale certificate, taken in good faith, tax will not apply to your sale. See CDTFA-230, General Resale Certificate.

To be valid, resale certificates must contain specific information. For more information, see Regulation 1668, Sales for Resale.

You can verify the validity of seller's permits by clicking the Verify a Permit, License, or Account link on the CDTFA website.

Nontaxable Sales of Food Products

Enter your nontaxable sales of food products sold for human consumption.

Whether food product sales are taxable depends on many conditions, including who makes the sale, where the sale occurs, who the customer is, and what is sold. For example, the following sales are generally taxable and should not be deducted:

  • Sales of alcoholic and carbonated beverages
  • Sales of hot prepared food products
  • Sales of meals or food sold for consumption at your place of business or sold for consumption in a place where admission is charged

For more information on food sales, see Regulation 1602, Food Products, or Regulation 1603, Taxable Sales of Food Products. Vending machine operators should see Regulation 1574, Vending Machine Operators.

Nontaxable Labor

Enter labor charges for installing premanufactured property or for repairing or reconditioning property to restore it to its original use.

Note: Labor charges for making or fabricating a new product (such as labor charges for making a ring or furniture), or for assembling a product, are generally taxable and should not be deducted. Tax applies even if your customer provides the property that you fabricate. (Regulation 1546, Installing, Repairing, Reconditioning in General, and Publication 108, Labor Charges.)

Sales to the United States Government

Enter sales made to:

  • The United States government or its unincorporated agencies and instrumentalities, such as the following federal departments: Treasury, Interior, Agriculture, or Defense
  • Any incorporated agency or instrumentality of the United States wholly owned by either the United States, or by a corporation wholly owned by the United States
  • The American Red Cross, its chapters and branches
  • Federal reserve banks, federal credit unions, federal land banks, and federal home loan banks

Note: Sales made to the State of California or to cities and counties and local governments in the state are generally taxable and should not be deducted. They are treated like any other sale. (Regulation 1614, Sales to the United States and Its Instrumentalities, or Publication 102, Sales to the U.S. Government.)

Sales in Interstate or Foreign Commerce (Delivered outside California)

Enter sales that are exempt from tax as interstate or foreign commerce (sales involving shipments or deliveries from California to points outside this state).

For a sale to be exempt, the sales agreement or contract must require the property to be shipped to an out-of-state point, and you must either:

Sales Tax (if any) Included in Total Sales

Enter an amount on this line only if the amount you reported as Total Sales includes California sales or use taxes. Enter only the tax amounts that are included as Total Sales. (Regulation 1700, Reimbursement for Sales Tax.)

Other Nontaxable Sales

Each nontaxable sale must be clearly explained.

You may be entitled to claim other nontaxable sales in addition to those listed on the return. You should choose from the Other Nontaxable Sales drop down list, provide a Description of the nontaxable sale, and the Nontaxable Amount.

Examples of transactions that may be nontaxable include the following:

  • Sales of Medicinal Cannabis. The exemption only applies to retail sales on or after November 9, 2016, of medical cannabis, medicinal cannabis concentrate, edible medicinal cannabis products, or topical cannabis as those terms are defined in Business and Professions Code section 26001. To obtain the exemption, qualified patients or their primary caregiver need to provide their valid Medical Marijuana Identification Card issued by the California Department of Public Health, under section 11362.71 of the Health and Safety Code, and a valid government issued identification card at the time of purchase.
  • Sales by pharmacists of prescription medicines for use by humans. (Regulation 1591, Medicines and Medical Devices.)
  • Transportation charges for delivering goods to a purchaser by an independent carrier (the transportation charges must be separately stated on the invoice). If you charge more for delivery than your actual costs, the added amount is subject to tax and cannot be deducted. (Regulation 1628, Transportation Charges, or Publication 100, Shipping and Delivery Charges.)
  • Sales of animals, seeds, plants and fertilizer, used as, or used to produce, food for human consumption. (Regulation 1587, Animal Life, Feed, Drugs and Medicines, and Regulation 1588, Seeds, Plants and Fertilizers.)

For more information, see Publication 61, Sales and Use Taxes: Tax Expenditures.

Adjustments, Credits, and Partial Exemptions

If the adjustment, credits, and partial exemptions section is not available on your return, please call our Customer Service Center at 1-800-400-7115 (CRS:711). Customer service representatives are available Monday through Friday from 7:30 a.m. to 5:00 p.m. (Pacific time), except state holidays.

Adjustments

Bad Debt Losses on Taxable Sales

Enter bad debt losses, as described below.

If you have reported a taxable sale and have been unable to collect payment for the sale, you may take an adjustment/deduction for the taxable sales portion of the bad debt.

Bad debts may take the form of:

  • Checks that have been returned to you unpaid by the purchaser's bank which you have determined to be uncollectible, or
  • Amounts from charge or credit sales that you have determined to be uncollectible.

The bad debts must be charged off for income tax purposes, or, if you are not required to file income tax returns, the bad debts must be charged off in accordance with generally accepted accounting principles.

Enter only the amount of the sale before tax. For example, if you sold merchandise for $15 plus sales tax and were unable to collect any amount for the sale, you would claim $15 as a adjustment/deduction.

If you claim a bad debt adjustment/deduction and later recover a payment, you must report the payment on the tax return filed for the period in which the recovery payment was made. (Regulation 1642, Bad Debts.)

Cost of Tax-Paid Purchases Resold Prior to Use

Claiming Cost of Tax-Paid Purchases Resold Prior to Use (Excludes Motor Vehicle Fuel and/or Diesel Fuel) You may claim an adjustment/deduction on this line if you:

  • Paid California sales or use tax when purchasing goods or merchandise, and
  • Sold the property without first using it (other than retaining, demonstrating, or displaying it while holding it for sale in the regular course of business).

Enter only the amount of the purchase price before tax. For example, if the property was sold to you for $15 plus tax, you would claim only $15 as an adjustment/deduction. (Regulation 1701, Tax-Paid Purchases Resold.)

Claiming Cost of Tax-Paid Purchases Resold Prior to Use (Motor Vehicle Fuel and/or Diesel Fuel)

If you paid California sales or use tax on motor vehicle fuel and/or diesel fuel and you need to claim a adjustment/deduction (that is, Cost of Tax-Paid Purchases Resold Prior to Use), please follow the detailed instructions below. You may also visit the CDTFA Industry and Tax and Fee Guides under Tax Guide for Motor Vehicle Dealers for additional information relating to this deduction.

To calculate your allowable Cost of Tax-Paid Purchases Resold adjustment/deduction for motor vehicle fuel purchases, you will need to know:

  1. The total cost of your motor vehicle fuel purchases, and
  2. Tax rate of the fuel station's location.

Claiming Cost of Tax-Paid Purchases Resold Prior to Use (Diesel Fuel)

To calculate the correct amount of your allowable Cost of Tax-Paid Purchases Resold adjustment/deduction for diesel fuel purchases, you will need to know:

  1. The total cost of your diesel fuel purchases, and
  2. Number of gallons of diesel fuel purchases, and
  3. Tax rate of the fuel station's location.

After you have gathered this information follow the steps below. Calculations transferred to the return should be in whole dollars. As a result, there may be minor differences due to rounding when calculating the return.

Returned Taxable Merchandise

Enter amounts you credited or refunded to customers for returned taxable merchandise, as described below. You can take this adjustment/deduction only if:

  • You returned or credited to your customer the full sales price, including sales tax charges, and
  • The customer, in order to obtain the refund or credit, is not required to purchase other property at a price greater than the amount charged for the property returned.

Claim only the amount of the sale before tax. For example, if the returned merchandise was sold for $15 plus sales tax, you would claim only $15 as an adjustment/deduction. (Regulation 1655, Returns, Defects and Replacements.)

Cash Discounts on Taxable Sales

If you gave a cash discount to a customer on a taxable sale, enter the amount of the discount here.

You can claim an adjustment/deduction on this line only if you reported the full (undiscounted) selling price in Total Sales. Do not use this line if you reported the discounted selling price in Total Sales on your return or a previous return. In addition, you must ensure that you do not collect from your customer more tax than the amount due on the discounted price. If you collect more than the amount due on the discounted price, you cannot claim this adjustment/deduction. (Regulation 1671, Trading Stamps and Related Promotional Plans, and Regulation 1700, Reimbursement for Sales Tax.)

Credits to Claim from Prior Filing Period

If you have credit to claim from a prior filing period (tax reported and paid on a previous return), you will be required to complete Schedule Q−Tax Credits (Adjustments) From Prior Periods, to claim those credits.

Partial Tax Exemptions

Exemption Certificate Requirements

Retailers who wish to claim a partial exemption must obtain from purchasers a timely and valid exemption certificate as described in Regulation 1667, Exemption Certificates. The CDTFA has designed a specific certificate for this purpose, entitled, “Partial Exemption Certificate.” The certificate is available on the CDTFA website or by calling the CDTFA Customer Service Center toll free at 1-800-400-7115 (CRS:711) for a copy. Retailers must retain the completed certificate for a period of not less than four years.

Teleproduction Equipment

To claim an exemption for sales or purchases made by qualified persons of tangible personal property used primarily in:

  • Teleproduction or other postproduction services for film or video that include editing, film and video transfers, transcoding, dubbing, subtitling, credits, closed captioning, audio production, special effects (visual or sound), graphics, animation, or
  • With respect to property with a useful life of at least one year to maintain, repair, measure, or test property used primarily in teleproduction or other postproduction services.

A qualified person is a business that is primarily engaged in providing the specialized motion picture or video postproduction services described above.

A qualified purchaser must provide the retailer with a Section 6378 Exemption Certificate; otherwise, the exemption will not be allowed.

This exemption does not apply to the sale or use of any tangible personal property that is used primarily in administration, general management, or marketing (used 50 percent or more of the time in one or more of those activities). (Regulation 1532, Teleproduction or Other Postproduction Service Equipment.)

Farm Equipment and Machinery

For a description of exempt farm equipment and who is eligible to claim this exemption see Publication 66, Agricultural Industry, and Regulation 1533.1, Farm Equipment and Machinery.

To claim a partial exemption for the sale, storage, use or other consumption of qualified farm equipment, machinery and its parts, as described below. It also applies to qualified lease payments for farm equipment and machinery rentals.

Who can claim a partial exemption?

You can claim this partial exemption if you are a person engaged in an agricultural business described in Codes 0111 to 0291 of the Standard Industrial Classification (SIC) Manual or are a person that assists such classified person by performing an agricultural service described in Codes 0711 to 0783 of the SIC manual.

What type of equipment is eligible?

“Implements of husbandry,” as defined in Revenue and Taxation Code section 411. Such property generally includes any tool, machinery, equipment, appliance, device, or apparatus. The farm equipment, machinery, and parts must be used primarily in producing and harvesting agricultural products. “Primarily” means 50 percent or more of the time.

Property as defined in Chapter 1, Division 16 of the Vehicle Code used exclusively in agricultural operations. Such property under certain conditions includes lift carriers, tip-bed type trailers, trailers/semi-trailers having no bed, spray or fertilizer applicator rigs, nurse rigs or equipment auxiliaries, row dusters, trap wagons, fertilizer nurse tanks or trailers, cotton trailers, truck tractors and truck tractor/semi-trailer combinations. Vehicles primarily designed for the transportation of persons or property on a highway are generally not considered implements of husbandry and, therefore, do not qualify for this partial exemption.

Diesel Fuel Used in Farming and Food Processing

For additional information for this exemption refer to Publication 66, Agricultural Industry, and Regulation 1533.2, Diesel Fuel Used In Farming Activities or Food Processing.

To claim a partial tax exemption for the sale, storage, use, or other consumption of diesel fuel used in farming or food processing activities.

The diesel fuel must be consumed during the activities of a farming business as set forth in Internal Revenue Code (IRC) 263A or food processing. A farming business is a business that grows crops, fruit or nut-bearing trees, sod, or nursery plants. Farming activities also include transporting these crops, fruit or nut-bearing trees, sod, or nursery plants to the marketplace.

Timber Harvesting Equipment and Machinery

For additional information for this exemption refer to Regulation 1534, Timber Harvesting Equipment and Machinery.

To claim a partial exemption of the sales and use tax for the sale, use, or other consumption of timber harvesting equipment, machinery, and their parts. Such equipment and machinery must be designed for use 50 percent or more of the time off-road in commercial timber harvesting and be used 50 percent or more of the time in timber harvesting. A qualified person is a person who is engaged in commercial timber harvesting. Commercial timber harvesting involves the cutting or removal, or both, of timber and other solid wood forest products from timberlands for commercial purposes. The partial exemption also applies to a qualified person's lease payments for qualified commercial timber harvesting equipment and machinery rentals.

Timber is considered to be trees of any species, excluding nursery stock, harvested for forest products. Some examples of these products include firewood, Christmas trees, biomass, poles, and pilings.

Typical off-road commercial harvesting equipment and machinery and their general use that may be eligible for this partial exemption include:

  • Tractors or rubber tired skidders—move the logs from the woods to the logging trucks
  • Front end loaders—load logs onto trucks
  • Feller-bunchers—cut very small trees
  • Cable Yarders—harvest trees on very steep slopes by suspending the logs on a cable
  • Chippers—chip small logs and brush into very small pieces
  • Chainsaws—used to cut down trees

Racehorse Breeding Stock

For additional information for this exemption refer to Regulation 1535, Racehorse Breeding Stock.

To claim a partial exemption of the sales and use tax for the sale, storage, use, or other consumption of “racehorse breeding stock.” “Racehorse breeding stock” means racehorses capable of and purchased solely for the purpose of breeding.

Partial Tax Exemption for Manufacturing and Research & Development Equipment

For additional information for this exemption refer to Regulation 1525.4, Manufacturing and Research & Development Equipment, or see our Tax Guide for Manufacturing and Research & Development Equipment Exemption.

This transaction is partially exempt from the total sales and use tax rate. It remains subject to 3.3125 percent of the total sales and use tax rate, plus any applicable district taxes.

To claim a partial state tax exemption for the sale, storage, use or other consumption of qualified manufacturing and research and development equipment, as described below.

To be eligible under this law, the purchaser must meet all three of these conditions:

  • Be engaged in certain types of business, also known as a “qualified person”.
  • Purchase “qualified property”.
  • Use that qualified property for the uses allowed by this law.

The California statewide sales and use tax base rate is currently 7.25%. Most local jurisdictions in California have added district taxes that increase the tax owed by a seller. District taxes are voter-approved transactions (sales) and use taxes imposed by cities, counties and other local jurisdictions.

Who must pay district taxes?

Generally, you must report and pay district taxes if:

  • You are a retailer located in the district and your merchandise is sold and delivered within the district.
  • You are “engaged in business” in a district (see next section) in which you sell merchandise for use in that district.

    What does “engaged in business” mean?

    You are “engaged in business” in a district if you meet one or more of the following conditions:

    • Have any type of business location there,
    • Deliver into the district using your own vehicle(s)
    • Own or lease real or tangible personal property in the district, including, but not limited to, a computer server
    • Have an agent or representative operating in the district for the purpose of making sales or deliveries, installing or assembling tangible personal property, taking orders, etc.
    • Receive rental payments from a lease of tangible personal property located in the district
    • Sell or lease vehicles or undocumented vessels which will be registered in a district
    • Meet the $500,000 threshold for the new additional district use tax collection requirement due to the Wayfair Decision (see Use Tax Collection Requirements Based on Sales into California due to the Wayfair Decision

Registered sellers of vehicles, undocumented vessels, and aircraft

If you are a registered seller of vehicles, undocumented vessels, or aircraft, you must generally apply tax to your sale or lease at the tax rate in effect at the California location where your customer will register or license their purchase.

This is true regardless of where the item is sold or delivered. If a district tax is in effect at the registration or licensing location, the total tax rate for the district (statewide rate + district rate) will apply to your sale. For more information, please see Publication 34, Motor Vehicle Dealers.

Schedule A Reporting Instructions

On the Schedule A- District Tax Schedule you will report all sales and purchases subject to district tax and distribute the applicable amounts, to the area(s) you are engaged in business. District taxes are in addition to the state wide base rate of 7.25%. Select the appropriate County and City using the drop-down menu and then enter your transactions for each district under the Taxable Amount column. The District Tax Due will automatically calculate.

Example 1: Sales made at a business location

You are a retailer located in the City of Inglewood who has made $6,000 in taxable sales. All sales are made over-the-counter, and therefore, subject to district tax. Use the drop-down menu beneath the County header to select Los Angeles County. Then use the drop-down menu under the City header to select Inglewood and enter $6,000 under the Taxable Amount header.

Example 2: Delivering merchandise by company vehicle

You are a retailer located in the City of Davis who has made $4,000 in taxable sales. All sales are made to a customer located in City of Rancho Cordova and merchandise was delivered by your company vehicle. You are engaged in business in City of Rancho Cordova by making delivery into the district using your vehicle. Use the drop-down menu beneath the County header to select Sacramento County. Then use the drop-down menu under the City header to select Rancho Cordova and enter $4,000 under the Taxable Amount header.

Sales and Purchases only subject to the state rate of 7.25% (not subject to district tax)

Transactions not subject to district tax will be reported under the Sales and Purchases subject to only the state rate of 7.25% (not subject to district tax) field.

Sales of property delivered to customers at a location where there is no district tax in effect

  • Sales of property (other than vehicles, aircraft, and vessels) delivered to customers at a district where you are not engaged in business
  • Purchases consumed at a location where there is no district tax in effect

District Tax Resources

If you are a vehicle auctioneer, you are required to complete and file CDTFA-531-AA, Vehicle Auction House Sales, with CDTFA-401-A, State, Local, and District Sales and Use Tax Return, or CDTFA-401-GS, State, Local, and District Sales and Use Tax Return – Motor Vehicle Fuel.

CDTFA-531-AA is used to report vehicles resold by a vehicle auctioneer. Amounts reported on this schedule are for informational purposes only and should not be used to calculate any tax amounts due.

PREPARATION OF THE SCHEDULE

Transaction Details:

Vehicle Identification Number (VIN) – Enter the used Vehicle Identification Number (VIN).

Vehicle Year – Enter the vehicle year.

Vehicle Make – Enter the vehicle make.

Vehicle Model – Enter the vehicle model.

Buyer's CDTFA Seller's Permit Number – Enter the buyer's CDTFA seller's permit number.

Buyer's DMV Dealer Number – Enter the buyer's Department of Motor Vehicles (DMV) dealer number.

Buyer's Name – Enter the buyer's name.

Buyer's Doing Business As (DBA) – Enter the buyer's Doing Business As (DBA) name.

Buyer's Street – Enter the buyer's street.

Buyer's City – Enter the buyer's city.

Buyer's State – Enter the buyer's state.

Buyer's ZIP Code – Enter the buyer's ZIP Code.

Selling Date – Enter the selling date (example: YYYY-MM-DD).

Out-of-State-Dealer – Select “Yes” if the dealer is an Out-of-State dealer

Selling Price – Enter the selling price.

CDTFA-531-AA Resources

“Local Taxes” are sales and use taxes imposed by local jurisdictions under the Bradley-Burns Uniform Local Sales and Use Tax Law. The current statewide sales and use tax base rate is 7.25%, which includes 1.25% of local taxes (1% Local Jurisdiction Fund and 0.25% Local Transportation Fund). For more information about local tax please see our Local and District Tax Guide for Retailers on the CDTFA website.

Schedule B- Detailed Allocation by County of Sales and Use Tax Transactions is used to allocate transactions subject to sales and use tax associated with the following business activities:

  • Construction contracts involving the installation of materials and/or fixtures at a jobsite
  • Shipping taxable goods from an out-of-state location with title passing to a California purchaser at a point outside of California (i.e. Shipping Terms – FOB shipping point)
  • Itinerant sales (i.e. mobile truck vendors, door-to-door sales, etc.)
  • Vending machine sales
  • Ex-tax purchases for use at locations where a seller's permit is not required
  • Auction events transacted at temporary location(s)
  • Leasing of motor vehicles acquired from out-of-state or used car dealership
  • Out-of-state leasing or long-term leases over 30 days (other than motor vehicles)

Schedule H – Detailed Allocation by City of Taxable Sales and Use Tax Transactions of $500,000 or More is used to report transactions subject to sales and use tax associated with the following business activities.

  • Single sale or purchase of $500,000 or more subject to use tax pursuant to Regulation 1802(d)(1).
  • Auction sales at a temporary location in an aggregate amount of $500,000 or more pursuant to Regulation 1802(b)(4).

Schedule B Reporting Instructions

The Schedule B has a drop-down menu that lists all the counties within California under the County In Which Taxable Transaction Occurred header. You will report the taxable amount under the Taxable Amount column for each county

Example: You made $2,000 in total sales in Sacramento County. Under the County In Which Taxable Transaction Occurred header, you would select Sacramento from the drop-down menu and report $2,000 under the Taxable Amount header.

Note: If you have multiple counties to report on Schedule B you will select each county under the County In Which Taxable Transaction Occurred header and report each sale or purchase subject to use tax under the Taxable Amount header

Local Tax Resources

“Local Taxes” are sales and use taxes imposed by local jurisdictions under the Bradley-Burns Uniform Local Sales and Use Tax Law. The current statewide sales and use tax base rate is 7.25%, which includes 1.25% of local taxes (1% Local Jurisdiction Fund and 0.25% Local Transportation Fund). For more information about local tax please see our Local and District Tax Guide for Retailers on the CDTFA website.

Schedule C- Detailed Allocation by Location of Local Sales and Use Tax Transactions is used to allocate transactions subject to sales and use tax to your registered California location(s). If your business address has changed or you don't see your location(s) on the schedule, please call our Customer Service Center at 1-800-400-7115 (CRS:711). Customer service representatives are available Monday through Friday from 7:30 a.m. to 5:00 p.m. (Pacific time), except state holidays.

A California location should be registered with the CDTFA if the location is considered as a selling location. A registered selling location is not limited to a retail store with over-the-counter sales where property exchanges hands, such as a retail store or restaurant. It is a business location where sales are made, negotiated, or sales can be attributed to the location as the “place of sale.”

  1. Made – For example, over the counter sales;
  2. Negotiated – For example, at sales office and/or sales negotiated by traveling sales representatives reporting to a California sales office.
  3. Fulfilled – For example, merchandise shipped from a California inventory location fulfilling sales negotiated out-of-state and/or by California sales representatives reporting to an out-of-state office.

Internet Sales

Internet sales that were processed and fulfilled from inventory in California should be reported to the registered place of business on Schedule C. These sales are subject to sales tax because there is participation from the California location and title of goods passes to customer in California.

Internet sales that are processed outside California with the orders being fulfilled from a registered inventory location in California, are reported on Schedule C. When an inventory location in California is fulfilling orders for sales negotiated outside California, the location of the computer servers for internet sales is irrelevant for purposes of local tax reporting.

NOTE: Do not report transactions associated with any of the following activities on Schedule C. You will report these transactions on Schedule B and/or H.

The below transactions should be reported on Schedule B- Detailed Allocation by County of Sales and Use Tax Transactions:

  • Construction contracts involving the installation of materials and/or fixtures at a jobsite
  • Shipping taxable goods from an out-of-state location with title passing to a California purchaser at a point outside of California (i.e. Shipping Terms – FOB shipping point)
  • Itinerant sales (i.e. mobile truck vendors, door-to-door sales, etc.)
  • Vending machine sales
  • Ex-tax purchases for use at locations where a seller's permit is not required
  • Auction events transacted at temporary location(s)
  • Leasing of motor vehicles acquired from out-of-state or used car dealership
  • Out-of-state leasing or long-term leases over 30 days (other than motor vehicles)

Exceptions: The below transactions should be reported on Schedule H – Detailed Allocation by City of Taxable Sales and Use Tax Transactions of $500,000 or More:

  • Single sale or purchase of $500,000 or more subject to use tax pursuant to Regulation 1802(d)(1).
  • Auction sales at a temporary location in an aggregate amount of $500,000 or more pursuant to Regulation 1802(b)(4).

Schedule C Reporting Instructions

Schedule C lists all of your registered locations. Report all sales and purchases subject to use tax under the Taxable Amount header.

Example 1: You have a $5,000 in taxable sales, of which $2,500 was made at your Sacramento store and $2,500 from your Davis store. All sales were made over-the-counter.

Under the Taxable Amount header, you will report $2,500 to each location.

Example 2: You have $5,000 in taxable sales. All sales were made online and processed outside California with orders fulfilled from a California warehouse located in San Francisco.

Under the Taxable Amount header, you will report $5,000 to your San Francisco location.

Local Tax Resources

“Local Taxes” are sales and use taxes imposed by local jurisdictions under the Bradley-Burns Uniform Local Sales and Use Tax Law. The current statewide sales and use tax base rate is 7.25%, which includes 1.25% of local taxes (1% Local Jurisdiction Fund and 0.25% Local Transportation Fund). For more information about local tax please see our Local and District Tax Guide for Retailers on the CDTFA website.

Schedule F – Detailed Allocation by City of Taxable Transactions for Lessors of Motor Vehicles is used to report leases of motor vehicles, to the jurisdiction of the new motor vehicle dealer, from whom the lessor acquired the leased vehicle pursuant to Section 7205.1 of the Revenue and Taxation Code. The following chart summarizes the Schedule F reporting requirements for leases of motor vehicles

OTHER IMPORTANT INFORMATION REGARDING LEASES

ASSIGNED LEASES. The place of allocation will remain the same for the duration of the lease, even if the lessor sells the vehicle and assigns the lease contract to a third party. Accordingly, if you are a lessor who assigns lease contracts to another lessor, you are required to provide the lessor with copies of the original purchase contract for each vehicle and/OR COPIES OF PRIOR SCHEDULES SHOWING HOW THE USE TAX HAS BEEN ALLOCATED.

COURTESY DELIVERIES. If a lease by an out-of-state lessor involves a courtesy delivery from an in-state inventory by a California new motor vehicle dealer, the taxable transaction on that lease should be allocated on Schedule F.

SPECIAL TAX DISTRICTS. Section 7205.1 does not affect the application of district taxes reported on Schedule A of your sales and use tax return. The district use tax due on motor vehicle leases continues to be allocated to the place where the vehicle is registered.

Schedule F Reporting Instructions

Seller's Permit Number: Enter the seller's permit number of the California new motor vehicle dealer from whom the lessor acquired the leased vehicle.

City Code: Using the listing of cities and tax area codes on CDTFA-531-FL-1 on the CDTFA website, locate the tax area code for the city/unincorporated area for the California new motor vehicle dealer from whom the lessor acquired the leased vehicle.

Taxable Amount of Lease Payments: Enter the taxable amount of lease payments.

Prepaid sales tax is imposed on each gallon of motor vehicle fuel, diesel and other qualifying fuels, and aircraft jet fuel removed, imported, or sold in California. Schedule G - Sales Tax Prepaid to Fuel Suppliers is required to be completed by all sellers of fuel.

For information and instructions on completing the online filing of Schedule G, please see below:

To add a supplier: Click Add Supplier and enter the Supplier's Name and Motor Vehicle Fuel (MVF) Pre-Collection account number. Next, enter the number of gallons for the motor vehicle fuel, diesel fuel, and/or jet fuel. Please note: The effective prepaid rate per gallon for each fuel type will be displayed for the reporting period.

Motor Vehicle Fuel:

  • Includes but is not limited to: Gasoline, gasohol, and blendstocks.
  • Does not include: Diesel fuel, kerosene, LPG and similar fuel.
  • Aviation gasoline for use in propelling aircraft is specifically excluded.

Diesel Fuel and Other Qualifying Fuels:

  • Include but are not limited to: Diesel fuel no. 1 and no. 2, clear diesel, dyed diesel, and biodiesel.
  • Does not include: Gasoline, methanol and ethanol not containing more than 15 percent gasoline or diesel fuels, and marine bunker fuel.

Aircraft Jet Fuel:

  • Includes any inflammable liquid which is used or sold for use in propelling aircraft operated by the jet or turbine type of engine.

Retailers who ARE NOT distributors, brokers, producers, importers, or jobbers of fuel:

  • Schedule G (401-GS): Report all purchases of fuel delivered during the reporting period.

Schedule G Reporting Instructions

Scenario 1 – You ordered 7,500 gallons of diesel fuel at the effective prepaid tax rate $0.31/gallon on March 31, 2019 and it was delivered on April 1, 2019 to your gas station. You will claim $2,325 prepaid sales tax (7,500 gallons x $0.31) on your Schedule G for the period 2nd Quarter 2019.

Scenario 2 – You ordered 1,500 gallons of motor vehicle fuel (gasoline) at the effective prepaid tax rate $0.05/gallon on June 30, 2018 and it was delivered on July 01, 2018 in which the motor vehicle fuel rate increased to $0.06/gallon. Your supplier will have to re-invoice you at the new rate and you will claim $90 prepaid sales tax (1,500 gallons x $0.06) on your Schedule G for the period 3rd Quarter 2018.

Retailers who ARE wholesalers (including cardlock), distributors, brokers, producers, importers or jobbers

You are required to obtain a Motor Vehicle Fuel (MVF) Pre-Collection account and must complete the monthly return Prepayment of Sales Tax on Fuel Sales (includes Schedules A and B-fuel)

  • Schedule B (Fuel): Report all purchases of fuel delivered during the reporting period.
  • Schedule A (Fuel): Report all removals (including cardlock sales). List your retail gallons (sales to the end-user) under your own Sales and Use tax account number. In addition, list your wholesale gallons under your customer's MVF pre-collection account number or Sales and Use tax account number. Please note if your customer has both account types mentioned above, the MVF Pre-Collection account number takes precedence.
  • Schedule G (Sales Tax Prepaid to Fuel Suppliers): Report only the gallons of fuel sold at retail – List your own MVF Pre-Collection account number and match the retail gallons reported on your Schedule A (fuel) for the corresponding MVF Pre-Collection monthly return(s).

Cost of Tax Paid Purchases Resold Prior to Use

If you sold fuel at retail that was purchased at a rate other than the prepaid sales tax rate for any qualifying fuels; DO NOT claim it on the Schedule G.

Schedule G Resources

“Local Taxes” are sales and use taxes imposed by local jurisdictions under the Bradley-Burns Uniform Local Sales and Use Tax Law. The current statewide sales and use tax base rate is 7.25%, which includes 1.25% of local taxes (1% Local Jurisdiction Fund and 0.25% Local Transportation Fund). For more information about local tax please see our Local and District Tax Guide for Retailers on the CDTFA website.

Schedule H- Detailed Allocation by City of Taxable Sales and Use Tax Transactions of $500,000 or More is used to report the following transactions:

  • Single sale or purchase of $500,000 or more subject to use tax pursuant to Regulation 1802(d)(1). Please note: A single contract/purchase order may include multiple transactions/invoices in which the total was $500,000 or more. You will report the actual physical street address of where the property was first functionally used (i.e. used for its intended purpose) or will be used.
  • Auction sales made at a location other than the auctioneer's registered selling location, totaling $500,000 or more. You will report the actual physical street address of the auction event.

Schedule H Reporting Instructions

For single sales or purchases of $500,000 or more subject to use tax, click Add a Record in the appropriate area and enter the address of first functional use (generally presumed to be where the goods were delivered).

For auction sales made at temporary sales locations, click Add a Record in the appropriate area and enter the address where the auction event was held.

Example: You are an out-of-state retailer of office furniture making sales to California customers. You do not have business locations, employees, or hold inventory in California. Sales are processed, and merchandise is shipped from New York directly to California customers, with title passing in California (i.e. Shipping Terms: FOB - Destination).

You have $1,500,000 in total taxable sales for the first quarter of the year. Of those sales, you have one single sale of $800,000 that was made to a customer located in the City of Cupertino. The merchandise was shipped to Cupertino where it will be first functionally used. This is a qualifying transaction to be reported on Schedule H. The remainder will be reported on Schedule B to the counties where the merchandise was shipped to.

Local Tax Resources

Beginning January 1, 2020, if you are an Aircraft Jet Fuel Retailer, you are required to complete and file this schedule, Aircraft Jet Fuel Retailers - Sales by Airport Location, with your CDTFA-401-GS, State, Local, and District Sales and Use Tax Return.

The Federal Aviation Administration (FAA) published final amendments to its policy on federal requirements for the use of proceeds from taxes on aviation fuel (Fed. Reg. 66282, Nov. 7, 2014). Under federal law, generally, airport operators that have accepted federal assistance may use airport revenues only for airport-related purposes. State and local taxes on aviation jet fuel are also subject to these airport revenue use requirements.

This schedule is used to report the taxable jet fuel sales and the amount of sales tax collected on jet fuel sales, allocated by airport location. Additionally, you must report the amount of taxable jet fuel sales and the amount of sales tax collected on jet fuel sales not sold at an airport location. Amounts reported on this schedule are for informational purposes only and are not used to calculate any tax amounts due.

PREPARATION OF THE SCHEDULE

City – Airport Name – Select the city and airport name.

Taxable Jet Fuel Sales – Enter the total amount of taxable jet fuel sales at each airport location where sales were made. Please do not include exempt sales of jet fuel.

Sales Tax Collected on Jet Fuel Sales – Enter the total amount of sales tax collected on taxable jet fuel sales at each airport location where sales were made.

Taxable Jet Sales not sold at an airport – Enter the total amount of taxable jet fuel sales not sold at an airport.

Sales Tax Collected on Jet Fuel Sales not sold at an airport – Enter the total amount of sales tax collected on taxable jet fuel sales not sold at an airport.

Beginning January 1, 2021, if you are a used vehicle dealer, you are required to complete and file CDTFA-531-MV, Used Vehicle Dealer – Sales Report, with CDTFA-401-A, State, Local, and District Sales and Use Tax Return, or CDTFA-401-GS, State, Local, and District Sales and Use Tax Return – Motor Vehicle Fuel.

This schedule is used to report your taxable vehicle sales and the amount of sales tax paid (if any) to the California Department of Motor Vehicles (DMV). Amounts reported on this schedule are used to calculate your sales tax paid to the DMV.

Schedule MV Reporting Instructions

Transaction Details

Report of Sales (ROS) Number – Enter the Report of Sale (ROS) number, as reported to the DMV. ROS must be 8 numeric characters.

Vehicle Identification Number (VIN) – Enter the used Vehicle Identification Number (VIN).

Selling Price Reported to DMV – Enter the vehicle selling price reported to DMV for taxable sales of vehicles. Include all taxable sales of vehicles, even if sales tax was not paid to the DMV. Only include sales made in this reporting month that were included in your total sales. Any charges related to sales not reported to DMV (for example: document fees, smog certification fees, mandatory warranties, among others) should be reported on the Total Sales line.

Sales Tax Paid to DMV (if any) – Enter the vehicle sales tax paid to DMV. Only include payments made to DMV on or before this return due date. If sales tax was not paid to DMV, enter 0.

Penalty Paid to DMV for Late Payments of Sales Tax – Enter the penalty amount for late sales tax payments made to DMV, if applicable. If none, enter 0.

Schedule MV Resources

Amounts claimed on Schedule Q-Tax Recovery Adjustments may only consist of tax recovery items where the original taxable sale was in a prior period and the tax credit occurred in the current period. If you have tax recovery items that should have been claimed on a prior return, you will need to amend the prior period return or file a claim for refund for those transactions rather than claiming them on this return. For example, if you made a taxable sale in the first quarter and the customer returned the merchandise in the second quarter, the returned merchandise tax recovery item may only be claimed on the return for the second quarter. If the second quarter return has already been filed, an amended return or claim for refund will need to be filed in order to obtain the credit (tax recovery).

Sales put on schedule Q, should not be included in Total Sales.

Prior Period Tax Recovery Types:

Schedule Q Reporting Instructions

Section A. Tax Recovery Information – select Add a Record and a box opens requesting specific information for the taxable transaction in four categories.

  1. Type – from the drop-down menu select the type of tax recovery that occurred. Then select the transaction period the original sale occurred.
    • Please note, if there are multiple of the same tax recovery type, that were originally reported in the same reporting period, with the same district tax and the same local tax allocation, you may combine the tax recovery(s) into one entry/one record. If all conditions are not the same, you will need to Add a Record for each prior period tax recovery you are reporting.
  2. Local Tax – Place of Sale – select the county and the city where the local tax was originally reported. You may or may not need to check the Registered Location box. The Registered Location box will only be checked if the local tax was originally reported on Schedule C- Local Tax Allocation or Schedule F- Local Tax for Lessors of Motor Vehicles. If the local tax was originally reported on Schedule B- Local Tax Allocation do not check the Registered Location box.
  3. If the tax recovery type is a Cost of Tax-Paid Purchases Sold Prior to Use you may not know where the local tax was originally reported by the seller.
    • Generally, if the supplier is located outside California and/or title transferred to you outside of California the local tax would have been allocated to the County where the supplier shipped you the goods and would have been originally reported on the supplier's Schedule B- Local Tax Allocation.
    • Generally, if the supplier is located inside California and was shipped to you from within California the local tax would be the County where the supplier's California business is located, and would have been reported on the supplier's Schedule C- Local Tax Allocation.
  4. District Tax – Place of sale, delivery, or jobsite – from the drop-down menu select the county and the city where you originally reported the district tax (Schedule A-District Tax Allocation).
    • If the tax recovery type is a Cost of Tax-Paid Purchases Sold Prior to Use the district tax originally reported by the supplier will generally depend on if you picked up the merchandise from the supplier or had the merchandise shipped or delivered to a location.
      • Generally, if picked up from the supplier you would have reimbursed the supplier the sales tax rate of the County/City where you picked up the merchandise.
      • Generally, if shipped or delivered the supplier would have collected the district tax rate of the County/City where delivered. This is typically the case when the supplier is considered “engaged in business” in the district of delivery.

    *For additional information on district tax, please see the Online Filing Instructions for Schedule A-District Tax Allocation.

  5. Amount – Enter the taxable measure which will result in a credit (tax recovery adjustment). The tax rate is prefilled and will calculate the credit (Tax Recovery Adjustment) amount. This credit will reduce the tax amount due once you get to the Summary page of the return.

Select Add at the bottom of the box. This returns you to the main Schedule Q – Tax Credits (Tax Recovery Adjustments) From Prior Periods; If any of the tax recovery items from Section A were originally taxed at a different tax rate due to a partial exemption or the higher rate of diesel you must complete Section B or Section C.

Once the necessary sections are completed, the bottom of the screen will provide the total credit for tax recovery. This credit will be reflected on the Summary page of the return.

“Local Taxes” are sales and use taxes imposed by local jurisdictions under the Bradley-Burns Uniform Local Sales and Use Tax Law. The current statewide sales and use tax base rate is 7.25%, which includes 1.25% of local taxes (1% Local Jurisdiction Fund and 0.25% Local Transportation Fund). For more information about local tax please see our Local and District Tax Guide for Retailers on the CDTFA website.

Schedule X- Partial Exemption from Bradley-Burns Local Taxes is used to report sales to, or purchases for use by, aircraft common carriers that qualify for the Bradley-Burns local tax partial exemption. The qualifying transactions must be included in the report Total Sales or Purchases Subject to Use Tax.

Schedule X Reporting Instructions

County Where Transactions Occurred

Click the drop down box to select the county where the transaction is reported on your local tax schedule.

City where Transaction Occurred

Click the drop down box to select the city where the transaction is reported on your local tax schedule.

Amount of Exemption

Enter the amount of the sale or purchase price subject to the exemption.