Glossary of Tax Terms
- Automated Clearing House. Any entity that operates as a clearing house for electronic debit or credit entries pursuant to an agreement with an association that is a member of the National Automated Clearing House Association (NACHA).
- ACH Credit
- The ACH Credit method allows you to transfer funds by instructing your financial institution to debit your account and credit the BOE’s bank account. This transfer is initiated by you through your financial institution.
- ACH Debit
- The ACH debit method allows you to transfer funds by authorizing the state to electronically debit your bank account for the amount you report to the state's data collection service. Your account will be debited only upon your initiation and for the amount you specify.
- Alcoholic Beverage Tax
- The alcoholic beverage tax is a per-gallon excise tax collected on the sale, distribution or importation of alcoholic beverages in California.
- Annotations are summaries of the conclusions reached in selected legal opinions issued by the BOE’s Legal Department. Annotations do not have the force or effect of law, but they do provide helpful guidance. For each annotation, the Board makes available a version of the legal opinion that has been summarized (known as a “back-up opinion”). Back-up opinions are redacted to omit all confidential taxpayer information contained in the original opinion.
- Annual Report
- Summary of our major program activities during the fiscal year, including statistical data for the sales and use, fuel, alcohol, tobacco, and other taxes and fees collected by the BOE.
- Taxpayers and feepayers who disagree with staff decisions to assess additional taxes, fees, interest, or penalties may file petitions to dispute the decisions through the BOE’s administrative appeals process. Taxpayers and feepayers also may request appeals conferences and hearings before the Board Members to dispute staff decisions denying claims for refund in whole or in part through the appeals process. Tax and Fee matters in the appeals process are commonly referred to as “appeals”. See publication 17, Appeals Procedures: Sales and Use Taxes and Special Taxes. There are separate appeals processes for business tax and fee, property tax, and franchise and income tax appeals. See Rules for Tax Appeals.
- During an audit, the BOE auditor will check your sales and purchases records to be sure that you correctly computed and reported your taxes and fees, and have documents in your records that support any exemptions from taxes or fees. See publication 76, Audits).
- Auto Pay
- Auto Pay is the quick, easy, and convenient way to make installment payments. When you enroll in Auto Pay we will debit your bank account for payments required by your installment payment agreement.
- Board of Equalization (BOE)
- The Board of Equalization (BOE) collects California sales and use tax, as well as fuel, alcohol, and tobacco taxes, and fees that provide revenue for state government and essential funding for counties, cities, and special districts. The BOE sets the value of state-assessed property, administers the private railroad car and timber yield taxes, co-administers the welfare and veterans’ organization property tax exemptions, equalizes assessments of government-owned property, audits county assessors’ assessment practices, adopts property tax regulations, and prescribes property tax forms. The BOE also hears appeals from actions of the Franchise Tax Board.
- Bradley-Burns Uniform Local Sales and Use Tax
- Uniform Local Tax refers to the Bradley-Burns Uniform Local Tax Law in which a percentage may be added to a statewide sales tax. This local tax is allocated to the counties and cities. Generally, the revenue obtained from the Uniform Local Tax goes to funding various county and city needs.
- Business Taxes Law Guide
- The Business Taxes Law Guide (BTLG) contains statutory and constitutional laws, regulations, court decisions, annotations, and other information on the business tax and fee programs the BOE administers.
- California Cigarette and Tobacco Products Retailer's License
- Under the Cigarette and Tobacco Products Licensing Act of 2003, every retailer who sells cigarettes or tobacco products must apply for and obtain a cigarette and tobacco products retailer's license from the Board of Equalization and renew it annually. “Retailer” means a person who sells cigarettes or tobacco products directly to the public from a California retail location, including vending machine. A separate license is required for each location or vending machine from which cigarettes or tobacco products are sold.
- California Tax Service Center
- The California Tax Service Center is sponsored by the California Fed State Partnership and includes the BOE, Employment Development Department, Franchise Tax Board, and Internal Revenue Service. The Tax Service Center provides taxpayer resources and educational programs. If you are an individual taxpayer or a small business owner, new to California or dealing with some special circumstances, you will find the Tax Service Center helpful.
- California Tire Fee
- The California Tire Fee is a fee imposed upon the purchase of a new tire. The fee is paid by a California retailer that sells new tires, or a California retailer (lessor) that leases/rents new or used motor vehicles, farm equipment, and/or construction equipment that include new tires, or a purchaser (consumer) who purchases new tires for his/her own personal or business use, but does not pay the tire fee at the time of purchase. This includes a retailer who becomes a purchaser (consumer) by removing new tires from inventory for purposes other than retail sale or resale.
- Corporate Credit or Debit Plus Addenda (formerly known as Cash Concentration or Disbursement). This is a standard NACHA data format used to make ACH transactions. The CCD+ format combines the widely used CCD format with a single addendum record that can carry 80 characters of payment-related data known as the TXP (see also "TXP").
- Certificate of Tax Clearance
- You should request a certificate of tax clearance from the BOE before you purchase a business or stock of goods to make sure the seller does not owe the BOE unpaid taxes or fees. If you do not obtain a certificate, you may incur a successor liability for certain unpaid taxes and fees the seller owes. See, e.g., publication 52, Vehicles and Vessels: How to Request a Use Tax Clearance, for DMV Registration, and BOE-106, Vehicle/Vessel Use Tax Clearance Request.
- Cigarette Distributor
- A cigarette distributor is a person who makes the first distribution of cigarettes in this state. Distribution includes the sale of untaxed cigarettes, the use or consumption by other than a licensed distributor of untaxed cigarettes, and the placing of untaxed cigarettes into a vending machine or retail store. The Cigarette and Tobacco Products Licensing Act of 2003 requires distributors of cigarettes and tobacco products to annually obtain and maintain a license from the BOE to engage in the sale of cigarettes or tobacco products in California.
- Cigarette Wholesaler
- A cigarette wholesaler is a person, other than a distributor, who sells stamped cigarettes for resale. The Cigarette and Tobacco Products Licensing Act of 2003 requires wholesalers of cigarettes and tobacco products to annually obtain and maintain a license from the BOE to engage in the sale of cigarettes and tobacco products.
- You must inform the BOE to close out your permit when any one of the following occurs: you are no longer actively engaged in business; you sell your business or stock of goods to someone else; you change the type of ownership for your business (for example, from a sole proprietorship to a corporation or partnership); when your partnership agreement calls for dissolution of the partnership and the formation of a new partnership when a change in partners occurs. See publication 74, Closing Out Your Seller's Permit.
- Compliance Assessment
- You are required to apply for and obtain a seller's permit if you desire to engage in the business of selling (or leasing) tangible personal property in California. If you fail to obtain a permit and file returns, the Sales and Use Tax Department may issue a Compliance Assessment (billing) based upon the information gathered by the Statewide Compliance and Outreach Program (SCOP). The Compliance Assessment will include any applicable penalties, such as the 10 percent penalty for failing to file a return by its due date. For more information, please see publication 75, Interest and Penalties. In addition to any penalties, you may also receive a misdemeanor citation for operating without a seller's permit or with a revoked permit under section 6071 of the Revenue and Taxation Code.
- Contribution Disclosure Statements
- You must file a disclosure statement to report “contributions” you may have made to Members of the BOE if you are a party or a participant, or a representative (agent) for a party or participant, in an adjudicatory proceeding pending before the Members of the BOE. Contribution has the same meaning prescribed in Government Code section 82015 and California Code of Regulations, title 2, section 18215. Generally, a “contribution” means: a payment (this could be in the form of money or nonmonetary items, such as donated goods or services or discounts); a forgiveness of a loan; a payment of a loan by a third party; or, an enforceable promise to make a payment except to the extent that full and adequate consideration is received, unless it is clear from the surrounding circumstances that it is not made for political purposes. See publication 151, Contribution Disclosure Statements.
- Covered Electronic Devices (CEDs)
- Covered Electronic Devices (CEDs) are subject to the Electronic Waste Recycling Fee. A CED is a new or refurbished electronic device containing a video display device measuring more than four inches diagonally. CEDs include computer monitors, laptop computers and portable DVD players with liquid crystal display (LCD) screens. Televisions containing LCD, plasma screens or cathode ray tubes are also considered CEDs. The California Department of Toxic Substances Control is responsible for determining which electronic devices are CEDs subject to the Electronic Waste Recycling Fee.
- Current Legal Digest
- Current Legal Digest means a publication containing drafts of new annotations proposed to be added, and/or annotations proposed to be amended or deleted in the Business Taxes Law Guide or Property Taxes Law Guide.
- Cigarette Importer
- Cigarette importer means any purchaser for resale in the United States of cigarettes manufactured outside of the United States for the purpose of making a first sale or distribution within the United States.
- Cigarette Manufacturer
- A cigarette manufacturer is a person that manufactures cigarettes sold in this state.
- Data Collection Service
- Also known as third-party vendor, the data collection service is the party responsible for the collection of taxpayers’ information for the purpose of initiating an ACH debit transaction. Taxpayers may report information to the service by means of voice and touch-tone telephone.
- Debit Date
- This is the date a transfer of funds takes place. It is also known as the settlement date.
- Delinquent Accounts
- Delinquent accounts are accounts that have failed to file tax returns by a due date, accounts that have failed to pay all of the taxes and fees that are due, accounts that have been mailed a Notice to Appear – Revocation Proceeding for any reason, accounts that have had their licenses or permits revoked for any reason, and any other accounts that have failed to comply with the law.
A cigarette or tobacco product distributor is a person who makes the first distribution of cigarettes or tobacco products in this state. Distribution includes the sale of untaxed cigarettes or tobacco products, the use or consumption of untaxed cigarettes or tobacco products, and the placing of untaxed cigarettes or tobacco products into a vending machine or retail stock.
Under the California Cigarette and Tobacco Products Licensing Act of 2003 (Act) every distributor (as defined in section 30011 of the Revenue and Taxation Code) is required to annually obtain and maintain a license from the BOE in order to engage in the sale of cigarette and tobacco products in California. This licensing requirement is in addition to other BOE permit and licensing programs that may be required depending on your business operations.
- District Office (Field Office)
- Field office staff handles registration, audit and collection functions for a geographical area encompassing the location of an office. Unless otherwise noted, all field offices are open from 8 a.m. to 5 p.m., Monday-Friday, Pacific time, excluding state holidays.
- District Tax
- Numerous special taxing districts throughout California impose district transactions (sales) and use taxes under the Transactions and Use Tax Law, which are administered by the BOE. The Revenue and Taxation Code provides that transactions (sales) taxes are due on sales of tangible personal property in a taxing district, and use taxes are due on retail purchases of tangible personal property for use in a taxing district. "Use" is defined as the use, storage, or other consumption of tangible personal property. District transactions (sales) taxes are imposed on retailers, however, retails may collect sales tax reimbursement from their customers. District use taxes are imposed on consumers, however, retailers are frequently required to collect district use tax from their customers (see publication 44, District Taxes and publication 105, District Taxes and Delivered Sales).
- Earnings Withhold Order (EWO)
- An EWO is a continuing wage garnishment based on a percentage of a debtor’s earnings, not to exceed 25 percent of disposable income. The EWO remains in effect until the total amount owing has been paid, or the order has been withdrawn.
- Electronic Funds Transfer (EFT) is a method for financial institutions to transfer funds from one account to another, eliminating the use of paper checks. An EFT payment can be initiated over the Internet, telephone, or computer software and modem.
- Electronic Transition Plan (ETP)
- Under the Electronic Transition Plan, sales and use taxpayers are being transitioned from paper to online filing.
- Electronic Waste Recycling Fee
- The Electronic Waste Recycling (eWaste) fee is imposed upon consumers that purchase certain video display devices. The various devices subject to the fee are known as “covered electronic devices” or CEDs.
- Employment Development Department (EDD)
- The California Employment Development Department (EDD) offers a wide variety of services to millions of Californians under the Job Service, Unemployment Insurance, Disability Insurance, Workforce Investment, and Labor Market Information programs. As California’s largest tax collection agency, EDD also handles the audit and collection of payroll taxes and maintains employment records for more than 17 million California workers. One of the largest departments in state government, EDD has over 8,000 employees providing services at more than 220 locations throughout the state.
- Enforcement Programs
- The Board of Equalization (BOE) has enforcement programs to investigate the proper reporting of use tax owed by service industry businesses statewide. California businesses that are not required to hold a seller's permit are being contacted by the BOE by letter and asked to review their records and self-report any use tax due for the past three years.
- Environmental Fee
- Businesses and organizations in industry groups that use generate or store hazardous materials or conduct activities related to those materials must pay California's environmental fee. The businesses and organizations include general partnerships, limited partnerships, limited liability partnerships, limited liability companies, sole proprietorships and all corporate entity types. These businesses and organizations must file returns and pay the fee if:
- They have 50 or more employees
- Each employed more than 500 hours in California during the prior calendar year
- In general, exclusions specify the items or activities that are not subject to taxes or fees because they are beyond the scope of the items or activities subject to the taxes or fees. For example, when a transaction is not a retail sale of tangible personal property, the charges from the transaction are excluded from the sales tax because sales tax applies only to charges arising from retail sales of tangible personal property. The sales and use tax exclusions are sales for resale, cash discounts, installation labor, returned merchandise, sales and use tax included in gross receipts, etc. There are lists of use tax exclusions and sales tax exclusions contained in Revenue and Taxation Code (RTC) sections 6011 (c) (1) through (12), and 6012 (c) (1) through (12), respectively. There are also sales and use tax exclusions in RTC sections 6006.5, 6009.1, 6010.1 through 6010.65, and 6012.1 through 6024.
- In general, exemptions specify the items or activities that are not subject to taxes or fees, but are not otherwise excluded from the scope of the taxes or fees. For example, when a transaction is a retail sale of tangible personal property in California, rather than a sale for resale, the sale will be subject to sales tax unless an exemption applies. Chapter 4, Exemptions, of the Sales and Use Tax Law (RTC § 6351 et seq.), includes general exemptions from both sales and use tax, exemptions from sales tax only, and exemptions from use tax only.
- A fee is imposed for the purpose of supporting a specific program, such as tire or electronic waste recycling, and revenue generated by a fee is deposited into a special fund maintained for that purpose. The BOE collects more than $53 billion annually from 25 revenue-generating tax and fee programs. See publication 41, Tax and Fees Administered by the Board of Equalization for more information on specific fees.
- Any person liable for the payment of the fees collected pursuant to a fee program. See publication 41, Tax and Fees Administered by the Board of Equalization for more information on specific fees.
- Fixed-Price Contract
- A fixed-price contract is designed to protect the business expectations of the parties when they entered into the contract and protect them from an unplanned increase in tax rate. If the tax rate should go down after the terms of your contract have been established, any sales made after the date of the tax decrease would be taxed at the new, lower rate.
- Franchise Tax Board (FTB)
- An administrative agency of the State of California that is responsible for collecting California personal and business income taxes.
- Gross Receipts
- Section 6012 of the Revenue and Taxation Code, defines “gross receipts” as the total amount of the sale or lease or rental price, as the case may be, of the retail sales of retailers, valued in money, whether received in money or otherwise.
- Homeowner Assistance Program
- This program allows a once-a-year payment from the State of California to qualified individuals based on part of the property taxes assessed and paid on their homes.
- The International Fuel Tax Agreement (IFTA) is a cooperative agreement among states and provinces in the U.S. and Canada. It is designed to simplify fuel tax licensing and reporting requirements for interstate motor carriers. In California, IFTA is administered by the State Board of Equalization. IFTA covers fuel taxes only. It does not cover road taxes, weight mileage taxes or any other jurisdiction-specific taxes. You must continue to pay those taxes directly to the jurisdictions in which you travel.
An importer means any purchaser for resale in the United States of cigarettes or tobacco products manufactured outside of the United States for the purpose of making a first sale or distribution within the United States.
Under the California Cigarette and Tobacco Products Licensing Act of 2003 (Act) every importer (as defined in section 30019 of the Revenue and Taxation Code) is required to annually obtain and maintain a license from the BOE in order to engage in the sale of cigarette and tobacco products in California. This licensing requirement is in addition to other BOE permit and licensing programs that may be required depending on your business operations.
- Internal Revenue Service (IRS)
- An administrative agency of the U.S. Department of the Treasury that is responsible for collecting federal personal and business income taxes and federal payroll taxes.
- The BOE may seize (levy) property, including money, to satisfy a collectible debt for taxes or fees. The BOE will issue a Notice of Levy to seize money, including bank accounts. The BOE will issue a warrant to seize and sell property other than money. (A levy on wages is also referred to as a wage garnishment.)
- A lien is a legal claim against real or personal property to satisfy a debt.
- Local Tax
- “Local Tax” is the general term for sales and use taxes imposed under the Bradley-Burns Uniform Sales and Use Tax Law.
A manufacturer is a person that manufactures cigarettes and tobacco products sold in this state.
Under the California Cigarette and Tobacco Products Licensing Act of 2003 (Act) every manufacturer (as defined in section 22971 of the Business and Professions Code) is required to annually obtain and maintain a license from the BOE in order to engage in the sale of cigarette and tobacco products in California. This licensing requirement is in addition to other BOE permit and licensing programs that may be required depending on your business operations.
- Memorandum Opinion
- The Board issues Memorandum Opinions as a means of resolving selected cases, which are appealed to the elected members. Taxpayers and feepayers may look to the Memorandum Opinions for guidance as to the Board's position on the legal issues discussed in those opinions. If a Memorandum Opinion presents facts and/or legal issues similar to those in a pending appeal, the Board will generally rely on that Memorandum Opinion to make its determination in the pending appeal.
- National Automated Clearing House Association. The association that establishes the standards, rules, and procedures that enable depository financial institutions to exchange ACH payments on a national basis.
- New Tire
- A “new tire” is a pneumatic* or solid tire that is intended for use with, but sold separately from::
- on-road or off-road motor vehicles;
- motorized equipment;
- construction equipment;
- farm equipment; and
- a new or used motor vehicle, including a trailer drawn upon a highway or road;
- new or used farm equipment; or
- new or used construction equipment;
A “new tire” does not include retreaded, reused, or recycled tires
- Nonprofit Organization
- Nonprofit organizations, in general, are treated just like other California sellers and buyers for sales and use tax purposes. Generally, nonprofit groups’ sales are taxable, as are their purchases. Although many nonprofit and religious organizations are exempt from federal and state income tax, there is no similar broad exemption from California sales and use tax. See publication 18, Nonprofit Organizations.
- Notice to Appear – Revocation Proceedings
- A Notice to Appear – Revocation Proceedings can be issued due to a taxpayer failing to file returns, pay a balance due, post security, etc.
- Occasional Seller
- An occasional seller does not charge tax on the sale of property held or used in the course of an activity not requiring the holding of a seller’s permit unless the sale is one of a series of sales sufficient in number, scope and character to constitute an activity for which the seller is required to hold a seller’s permit or would be required to hold a seller’s permit if the activity were conducted in this state. Generally, a person who makes three or more sales for substantial amounts in a period of 12 months is required to hold a seller’s permit regardless of whether the sales are at retail or are for resale. A person who makes a substantial number of sales for relatively small amounts is also required to hold a seller’s permit.
- Occupational Lead Poisoning Prevention Fee
- This fee is charged to employers in specific Standard Industrial Classification (SIC) codes to support the Occupational Lead Poisoning Prevention Program, which is administered by the California Department of Public Health. Employers are liable for the fee if their business:
- Is in an industry category that has been identified as having a potential for occupational lead poisoning
- Has lead or lead-containing materials present in the business operation during the previous calendar year, and
- Had 10 or more employees who each were employed for 160 hours or more during the previous calendar year- whether or not an individual employee's specific job involved exposure to lead or lead-contaminating materials
- Offer in Compromise (OIC)
- An offer in compromise (OIC) is a proposal to pay us an amount that is less than the full tax or fee liability due. If you make an offer and we accept it, you will no longer be liable for the full amount due and we will release any related tax liens as provided by the terms and conditions relative to your offer (see publication 56, Offers in Compromise).
- Online Filing
- The Online Program provides eligible taxpayers with an electronic method to file tax returns, prepayments, reports and claims for refund (Motor Fuels Tax accounts only) over the Internet. For more information see publication 159, eFile Guide.
- The BOE may impose monetary fines (penalties) on you for failing to comply with BOE-administered taxes and fees. For example, you are subject to a 10 percent penalty if you do not file your sales and use tax return by its due date or your tax payment is late. However, if you file a late sales and use tax return and make a late payment for the same reporting period, your total penalty will not exceed 10 percent of the amount of tax due for the reporting period. See publication 75, Interest and Penalties.
- Power of Attorney
- A legal document that allows someone else to act on your behalf, in matters that you specify in the Power of Attorney document. See BOE-392, Power of Attorney.
- Prenote Test
- A zero-dollar entry sent through the ACH network to verify banking information. If a prenote (prenotification) is processed, it should be done at least 10 calendar days before EFT payment initiation.
- Property Taxes Law Guides
- The Property Taxes Law Guide contains laws, rules (regulations), court decisions, annotations, and other information on the property, timber yield, and private railroad car taxes.
- Qualified Motor Vehicle (Under IFTA)
- A vehicle used or designed to transport people or property in connection with a business is a qualified motor vehicle if it meets any one of the qualifications below:
- It has two axles and a gross vehicle weight of more than 26,000 pounds or 11,797 kilograms
- It has three or more axles (power unit only), regardless of weight
- It is used in a combination or registered gross vehicle weight of more than 26,000 pounds or 11,797 kilograms
- Reference Number
- A number provided by the data collection service to callers using the ACH debit payment method. Given after a caller has provided information needed to initiate a payment, the reference number confirms that the tax payment has been accepted. It indicates the date and time the payment was reported and can be used to help trace a payment. Reference numbers may also be used in Fedwire transactions.
- “Regulation” means every rule, regulation, order, or standard of general application or the amendment, supplement, or revision of any rule, regulation, order or standard adopted by any state agency to implement, interpret, or make specific the law enforced or administered by it, or to govern its procedure. Government Code section 11342.600.
- Reimbursement Schedule
- Reimbursement schedules are available to assist taxpayers with charging the appropriate amount of tax on a transaction depending on the rate in an area.
- Reporting Period
- The BOE generally requires businesses to file their tax and fee returns for regular calendar periods (reporting periods), such as months, calendar quarters, semi-annually, or annually. However, if your business has established accounting periods that do not correspond to regular calendar periods, the BOE may be able to customize your tax reporting periods to suit your accounting practices. For example, the BOE generally requires retailers to file sales and use tax returns for the first quarter of the calendar year, which must report sales and purchases during the reporting period from January 1 through March 31. If, however, your first quarter accounting period runs from January 7 through April 4, you may request that you be allowed to report transactions for that specific reporting period. See BOE-715, Special Reporting Periods for Sales and Use Tax.
- Request for Extension
- If you are unable to file your return on time, you may qualify for an extension.
A Request for an Extension may be submitted online by selecting “Request a Filing Extension” from the “File a Return” drop-down menu on our website at www.boe.ca.gov.
- Resale Certificate
- The resale certificate is a document provided by a buyer or a wholesaler to document a purchase of tangible personal property for resale (i.e. no tax is charged on transaction due to resale). See publication 103, Sales for Resale.
- Retail Sales
- A sale of tangible personal property in California subject to sales tax.
- Whenever any person fails to comply with any of the provisions of the law under which a permit or license is held, the Board, upon hearing for which 10 days notice has been given, may revoke the permit or license.
- The BOE requires tax and fee payers to report their taxes and fees on returns, which may be prepared and filed online or by using forms provided by the state. For example, BOE-401-A and BOE-401-GS returns are used to report taxes due under the California Sales and Use Tax Law, the Uniform Local Sales and Use Tax Law, and the Transactions (Sales) and Use Tax Law, which are administered by the BOE. If you are a single-outlet retailer and file a BOE-401-A return to report sales and use taxes, you may be eligible to make your payments and file your returns electronically.
- Sales Tax Clearance
- A certificate of sales tax clearance protects the purchaser of a business from being held liable as a successor for amounts which the seller fails to pay, limited to the extent of the purchase price. The Board would determine if the business you are buying owes any unpaid sales and use taxes, interest, or penalties. If any money is owed, the seller will be asked to pay the amount due or you will be asked to withhold an amount from the purchase price to cover any amounts due.
- Sales and Use Tax Rate
- The combined statewide sales and use tax rate is 7.50%, effective January 1, 2013. However, many of California’s counties and cities have special taxing districts, which also impose district taxes. The tax rates for these districts range from 0.10% to 1.00% per district and this amount is added to the combined statewide rate. In addition, more than one district tax may be in effect in a given location. For current tax rates, please visit the California City & County Sales & Use Tax Rates webpage.
- Sales Tax Reimbursement
- Retailers may add sales tax reimbursement to the price of tangible personal property purchased by their customers if: (1) their sales contracts provide for the addition of sales tax reimbursement; (2) the sales tax reimbursement is shown on the customer’s sales receipt; (3) the retailers post signs in visible locations advising their customers that sales tax reimbursement is added to the price of tangible personal property; or (4) the retailers’ price tags indicate that sales tax reimbursement will be added. The BOE publishes reimbursement schedules retailers can use to calculate the correct amount of sales tax reimbursement.
- Sales Tax
- A tax assessed to a transfer of title or possession, exchange, or barter, conditional or otherwise, in any manner or by any means whatsoever, of tangible personal property for a consideration.
- SCOP (Statewide Compliance and Outreach Program)
- The Statewide Compliance and Outreach Program (SCOP) focuses on identifying and registering businesses who are actively selling tangible personal property in California without a seller's permit. In general, the purpose of SCOP is to advise business owners about when they need a seller's permit, how to report and remit their taxes and fees due, and address possible underreporting for those businesses that have a seller’s permit.
- Seller’s Permit
- A state business license that allows a business to make sales of tangible person property in California. For more information, see publication 73, Your California Seller’s Permit.
- Under this program, staff negotiate settlements of certain Sales and Use Tax and Special Tax and Fee cases consistent with a reasonable evaluation of the risks and costs of litigating those cases.
- When you buy all or part of a business or stock of goods, you may become responsible for the seller’s unpaid taxes, fees, interest, and penalties up to the purchase price of the business or stock of goods. This is called “successor’s liability.” To prevent successor liability, you or your agent must make a written request for a certificate of tax clearance before the sale is completed. After receiving the request, we will determine if the seller of the business you are buying owes any unpaid taxes, fees, interest, or penalties. If the seller does not owe any unpaid taxes, fees, interest, or penalties subject to successor liability, we will issue a certificate of tax clearance. If any money is owed, the seller will be asked to pay the amount due or you will be asked to withhold an amount from the purchase price to cover any amounts due. For more information regarding successor liability for sales and use taxes. See Regulation 1702, Successor’s Liability.
- Tangible Personal Property
- Merchandise, goods, items, or physical products (see publication 46, Leasing of Tangible Personal Property).
- Tax Gap
- The “tax gap” is the difference between taxes owed and taxes paid to the State of California.
- Tax Rate
The total tax rate includes the standard tax rate plus the district tax rate (which varies from district to district). You may be required to report and pay district taxes for your taxable sales and purchases. See publication 44, District Taxes and publication 105, District Taxes and Delivered Sales.
- Tobacco Distributor
- A tobacco products distributor is a person who makes the first distribution of tobacco products in this state. Distribution includes the sale of untaxed tobacco products, the use or consumption of untaxed tobacco products, and the placing of untaxed tobacco products into a vending machine or retail store. Under the California Cigarette and Tobacco Products Licensing Act of 2003, every distributor is required to annually obtain and maintain a license from the BOE in order to engage in the sale of cigarette and tobacco products in California. This licensing requirement is in addition to other BOE permit and licensing programs that may be required depending on your business operations.
- Tobacco Importer
- Tobacco importer means any purchaser for resale in the United States of tobacco products manufactured outside of the United States for the purpose of making a first sale or distribution within the United States.
- Tobacco Manufacturer
- A tobacco manufacturer is a person that manufactures tobacco products sold in this state.
- Tobacco Products
- Tobacco products include all forms of cigars, smoking tobacco, chewing tobacco, and snuff, as well as other products containing at least 50 percent tobacco, but not cigarettes.
- Tobacco Products Wholesaler
- A tobacco products wholesaler is a person who sells tax-paid products for resale, other than a distributor. The Cigarette and Tobacco Products Licensing Act of 2003 requires wholesalers of cigarettes and tobacco products to annually obtain and maintain a license from the BOE to engage in the sale of cigarettes and tobacco products.
- Tax Payment Banking Convention Record Format. Contains the data format, contents, and implementation suggestions for taxpayers to pay state taxes through the automated clearing house under the ACH method. This convention is to be used with the NACHA CCD+ format and is used in the majority of other states using EFT for tax collections. The format is carried in the 80-character free-form field of the addendum record.
- Underground Storage Tank
- Any tank or combination of tanks used to store petroleum products and located substantially or totally beneath the surface of the ground. This definition also applies to pipes that are connected to such tanks.
- Underground Storage Tank Maintenance Fee
- The Underground Storage Tank Maintenance fee is imposed on the number of gallons of certain petroleum products that are placed into underground storage tanks. Petroleum products include gasoline, aviation gasoline, jet fuel, diesel fuel, lubrication oils, heating and lighting oils and solvents. The owner of the tank is required to pay the underground storage tank fee. The fee does not apply to motor fuel or heating oil used for noncommercial purposes and placed in tanks having a capacity of 1,100 gallons or less, located on a farm or residence.
- Use Tax
- In general, where sales tax does not apply, use tax is imposed on the purchase of tangible personal property from a retailer for storage, use, or other consumption in California. The tax is imposed on the purchaser (consumer), however, retailers that are engaged in business in California must register with the BOE and collect use tax from their customers. Many individuals and businesses in California buy tangible items from out-of-state businesses that do not collect California tax on their sales. If you make such a purchase and then use, give away, store, or otherwise consume the tangible item in this state, you may owe California use tax. This is true whether you order over the Internet, by telephone, or by mail. The use tax rate for a given California location is the same as the sales tax rate there. The BOE is currently pursuing the collection of use tax owed by California businesses that are not required to hold a seller's permit. For more information, please visit the California Use Tax Information webpage.
- Voluntary Disclosure Program
- Allows qualified entities or beneficiaries that may have incurred an unpaid California tax liability or an unfulfilled filing requirement to disclose their liability voluntarily and limit the period for which BOE can make an assessment.
- Warehousing a Payment
- This feature allows you to contact the data collection service and select a future date for your payment to transfer in the Board’s bank account.
A cigarette or tobacco product wholesaler is a person, other than a distributor, who sells stamped cigarettes or taxed tobacco products for resale.
Under the California Cigarette and Tobacco Products Licensing Act of 2003 (Act) every wholesaler (defined in section 30016 of the Revenue and Taxation Code) is required to annually obtain and maintain a license from the BOE in order to engage in the sale of cigarette and tobacco products in California. This licensing requirement is in addition to other BOE permit and licensing programs that may be required depending on your business operations.