California Use Tax Information
Do I owe California use tax? You may owe use tax if you purchased an item from an out-of-state retailer and were not charged California sales tax. If you do not have receipts, you can pay estimated use tax on your tax return based on income.
California’s Use Tax Rate
California’s use tax rate is 7.25% statewide in addition to any local taxes. It applies to items purchased outside of California that are brought into and used in California. Use tax ensures out-of-state purchases are taxed similarly to in-state purchases.
California Use Tax Exemptions
Some items exempt from California use tax include food products for human consumption, sales to the U.S. Government, prescription medicine, and certain medical devices.
Penalty for Unpaid Use Tax
If use tax is not paid, you may owe a 10% penalty plus interest. Amazon purchases from third-party sellers are generally subject to use tax.
Business Use Tax Obligations
You owe use tax on business purchases if not registered with the CDTFA to collect sales tax. Also owed on individual items purchased for $1000 or more.
Calculating Use Tax
To calculate use tax, use the worksheet or table. The tax rate varies by location. Tax owed on vehicles is based on the sales price. File returns and pay taxes owed to the Franchise Tax Board.