Tax Guide for Native Americans
Getting Started

If you own a business on a reservation or any other location in California and sell tangible personal property (that is, items that can be seen, weighed, measured, felt, or touched), you may be required to register with us for a seller's permit and regularly file sales and use tax returns. Whether you are a new or existing business owner, you will find these tools helpful in maintaining your account with us.

Registration

Register with us online to obtain your seller's permit or to add a business location to an existing account. In addition to holding a seller's permit, you may also need to register for another license or permit with us. For more information about permits or licenses we administer, please see our Online Services Registrations page.

Filing, Payments, and Account Maintenance

• Tax Return Filing Deadlines — Find your filing due dates.
• File a Tax Return Online — File online with us. The services are easy, fast, and free!
• Online Payment Options — Make payments online for tax and fee programs.
• Taxpayer Online Service Portal — Update your account information by logging in to our online services system.

Sales and Use Taxes in General

In California, retail sales of tangible personal property are taxable unless the law provides a specific exemption or exclusion. Sales tax is imposed on retailers and generally applies to the retailers' gross receipts from their sales of tangible personal property made within California.

While there is no general sales tax exemption for sales to Native Americans, this guide explains when and how sales or use tax is applicable to transactions with Native Americans and non-Native Americans when the transactions occur on a reservation. This guide also describes the types of documentation that retailers and Native American purchasers need to maintain for qualified exemptions from paying sales or use taxes on certain transactions.

Use tax is imposed on consumers. When sales tax does not apply, use tax generally applies to the purchase of taxable items made from an out-of-state retailer for use in California. You may also owe use tax on items that you remove from your inventory and use in California when you did not pay tax when you purchased the items.

Seller's Permit

Most people who sell taxable merchandise or perform taxable labor in California, even temporarily, must register with us for a seller's permit. Registering for a seller's permit is free, although in some cases a security deposit may be required.

If you have more than one place of business (located at a different address), you generally must separately register each individual location with us. Generally, it is possible to obtain a consolidated permit for multiple locations. A consolidated permit has sub-permits issued for each location. At the time you apply for a permit, be sure to provide information for all business locations.

Whether you are a Native American, a Native American organization, or a non-Native American, you generally must hold a seller's permit when making sales in California. Certain sales made only on reservations by Native American retailers, including federally licensed Native American traders, are subject to use tax but not sales tax.

Native American sellers who only make this type of sale do not need a seller's permit. Instead, they must obtain a California Certificate of Registration — Use Tax. You can register by visiting our website, and under the How Do I… drop-down menu, select Register for a Permit, License, or Account. On the Online Services webpage, click Get Started and then click Register for a Permit, License, or Account under the Registration heading.

Be sure to let us know about any changes to your business, or to your mailing or email address, so we can keep our records updated and inform you of important changes in laws, tax rates, or procedures. You can easily update your account information through our online services system by logging in with a username and password. You may also contact our Customer Service Center or any one of our offices  throughout the state. Contact information is available in the Resources section of this guide.

If you are selling on a reservation, you may need to obtain a tribal sales license. Please contact the tribal government in whose jurisdiction you are operating for information regarding the requirement to obtain a tribal sales license and the proper application of tribal tax laws.

A tribal sales license is not a legal substitute for a California seller's permit or a Certificate of Registration — Use Tax to collect use tax.

Sales for Resale

As a retailer, you may make nontaxable sales for resale to Native American or non-Native American businesses. These businesses will sell the property they buy from you or physically include the property in items they make or sell.

If you accept in good faith a timely, completed resale certificate from your customer, you generally do not owe tax on your sale.

Retailers may purchase items for resale whether or not they are required to hold a seller's permit. Native American purchasers who are not required to hold a seller's permit need to make note of this fact on their resale certificate. For example, the purchaser may state, “I do not hold a California seller's permit for all my sales are made on a reservation. None of my sales are subject to California sales or use tax.”

Other documents to show the purchaser is selling the kind of property being purchased may include business license, business card, or a copy of an advertisement from a newspaper or telephone book.

For more information, please see Regulation 1668, Sales for Resale, and our publication 103, Sales for Resale.

Recordkeeping

If you hold a California seller's permit or any other CDTFA license or permit, you are required to maintain business records to verify that you have properly reported and paid the tax or fee.

Maintaining good books and records will help you keep track of your sales and purchases and will assist you when preparing your sales and use tax returns. You are required to keep records for at least four years, unless directed by us to keep them longer. Not maintaining records may be considered evidence of negligence or as an intent to evade the tax laws. This may result in penalties.

Your records should be adequate so our representatives may:

• Verify the accuracy of your tax returns; and
• Determine if you have correctly paid the tax due on your sales and purchases.

Records you should keep include, but are not limited to:

• Cash register tapes and receipts
• Purchase invoices
• Sales invoices
• Shipping documents
• Resale and exemption certificates
• Tax returns and supporting documents

For more information on recordkeeping, please see publication 116, Sales and Use Tax Records.

Know Your Tax Rates

The current statewide base sales and use tax rate is 7.25 percent. However, the total sales and use tax rates are higher in areas where district taxes are imposed. Please visit the Find a Sales and Use Tax Rate webpage to look up the rate for a specific address.

District taxes are voter-approved taxes imposed by cities, counties, and other local jurisdictions and are added to the statewide base rate. As a retailer, you are responsible for reporting your retail sales and paying the tax to us at the proper rate. If you make retail sales in California from a business located in a taxing district, you are generally responsible for the district sales tax. You are also responsible for collecting, reporting, and paying the district use tax when making sales for delivery into taxing districts in which you are considered “engaged in business in the district.”

Generally, you are “engaged in business in a district” when you:

• Have a permanent or temporary business location in the district, including a warehouse, salesroom, or office,
• Have a representative or agent in the district even temporarily, who, for example, makes sales, takes orders, or makes deliveries for you,
• Receive rental income from the lease of merchandise located in the district, or
• Make annual sales of tangible personal property in California or for delivery in California exceeding $500,000.
  • On and after April 25, 2019, a retailer is considered engaged in business in all districts that impose a district tax if in the preceding or current calendar year their total combined sales of tangible personal property in this state or for delivery in this state exceed $500,000. As such, all retailers meeting this threshold are responsible for collecting and paying any district tax on taxable sales made for delivery in any district that imposes a district tax.

For more information on being engaged in business and the correct district tax rates, please see publication 44, District Taxes (Sales and Use Taxes).

You can look up tax rates by city and county or find the full tax rate in your city or county by going to the Find a Sales and Use Tax Rate webpage and entering the address as prompted.

Sales to Native American Tribal Governments

The Sales and Use Tax law provides the exemption for sales of property used in tribal self-governance.

According to Regulation 1616, Federal Areas, to qualify for this exemption, all these criteria must be met:

1. The sale must be to a tribal government of a Native American tribe that is officially recognized by the United States,
2. The tribal government's Indian tribe does not have a reservation, or the principal place where the tribal government meets to conduct tribal business is not on the reservation because the reservation does not have a building or lacks essential utility services necessary to meet and conduct tribal business,
3. The property is purchased by the tribal government for use in tribal self-governance, and
4. Title to the property transfers and the property is delivered to the tribal government at the principal place where the tribal government meets to conduct tribal business.

Since the tribal government may take title and possession of the property outside of Indian country and still qualify as an exempt transaction under the circumstances outlined above, a retailer may verify that the address at which title to the property will transfer is valid by examining the list below. This list contains tribal governments along with the address at which they meet to conduct tribal business that are outside Indian country. Additionally, the retailer should obtain an exemption certificate from the tribal government as supporting documentation for the exempt sale. Tribal governments may use CDTFA-146-TSG, Exemption Certificate — Property Used in Tribal Self-Governance and Statement of Delivery, as part of the necessary documentation to retailers that the sale meets the criteria for the exemption as outlined above.

Tribal Government Meeting Locations outside Indian Country

Each federally recognized Native American tribe listed below has provided information to us indicating that its tribal government is eligible for the exemption for property used in tribal self-governance provided by Regulation 1616, Federal Areas. The location listed under each federally recognized Native American tribe's name is the location each tribe has identified as the principal place where that tribe's tribal government meets to conduct tribal business outside Indian country. Delivery locations that no longer qualify are also listed at the bottom of this page.

List of Eligible Tribal Governments and Their Delivery Locations Outside Indian Country

(Current as of February 8, 2024)

Please Note: The following tribes listed do not have tribal land. For acceptance of exemption certificates from tribes with land, please see publication 146, Sales to Native Americans and Sales in Indian Country.

Tribal Governments and Delivery Locations Previously Approved but No Longer Qualify

Please contact us if you believe your tribal government is eligible for the exemption discussed above and your tribal government is not on the list of eligible tribal governments. To be added to the list, please provide:

• The name of the tribe
• The name, address, and telephone number of the contact person
• The address of the qualifying location
• An explanation why your tribal government is eligible for the exemption

The information may be provided via email or a letter to:
California Department of Tax and Fee Administration
Business Taxes Committee MIC:50
P.O. Box 942879
Sacramento, CA 94279-0050