2010 Use Tax Returns
California has adopted new budget measures, as part of Assembly Bill No. X4 18 (ABX4 18) the new Sales and Use Tax Law requires many businesses to register with the State Board of Equalization (BOE), regardless of whether or not you sell tangible goods. It applies to every California business that receives at least $100,000 in gross revenues during a year. Businesses that already hold a resale license or are otherwise already registered with the BOE do not need to re-register. But service providers will need to register and file an annual use tax return.

What is a California Use Tax?
Many individuals and businesses in California buy items from out-of-state retailers that are not required or authorized to collect California tax. If you make such a purchase and then use, give away, store, or otherwise consume the item in California, you may owe California use tax. This is true whether you order the item over the Internet, by telephone, or by mail. The use tax rate for any California location is the same as the sales tax rate. Tax returns for 2009 are due by April 15, 2010. Penalty and interest applies to payments made after the due date.

Even if you haven't purchased out of state goods you are still required to register and file a return. The Use Tax Law has always existed but lacked a provision for registration and filing, (Use Tax was only included on your sales tax return). Now you need to register and file a separate return whether or not you have purchased any out of state goods. There are some exceptions. Please consult your Use Tax Advisor.

Purchases from Out of State Vendors
Download Use Tax Form
Read more about the budget legislation
Sept. 2009: New Registration and Reporting Requirements for Certain Purchasers
September 8, 2009: 'The BOE will be notifying 184,000 businesses by letter'

Reprinted with permission by Payroll Masters.