California's sales tax generally applies to the sale of merchandise, including vehicles, in the state. California's use tax applies to the use, storage, or other consumption of those same kinds of items in the state.
Generally, if sales tax would apply when you buy physical merchandise in California, use tax applies when you make a similar purchase without tax from a business located outside the state.
For these purchases, the buyer is required to pay use tax separately.
If you made purchases for a business use and may owe tax, click on the For Business Use tab for more information and payment options.
If you made purchases for your personal use and may owe tax, click on the For Personal Use tab for more information and payment options. Watch this video for more information about use tax:
Many smart shoppers can find bargains online, but don't realize they can incur a tax bill in the process. California law requires tax on in-state purchases, and also requires tax on items purchased out-of-state for use in California.
If you have a California seller's permit, you must pay the use tax due on business related purchases with your sales and use tax return in the period when you first used, stored, or consumed the item in California. Report the amount of your purchase under “Purchases subject to use tax,” (line 2) on the return.
If you are a “qualified purchaser,” you must pay your use tax due by filing your return for the previous calendar year by April 15.
A “qualified purchaser” must register with us and annually report and pay use tax directly to us, as required by Revenue and Taxation Code (R&TC) section 6225. If you are not required to hold a seller’s permit and are not currently registered with us for use tax purposes, you may be required to register as a “qualified purchaser.”
A "qualified purchaser" means a person that meets all of the following conditions:
You can register on our website at www.cdtfa.ca.gov by selecting Register Online under Register for a Permit and then selecting Register a New Business Activity. Once you have registered, you may pay any use tax due after filing your return. You can also register to report use tax in person at any of our offices.
If you are not required to have a seller's permit or a use tax account you must pay use tax in one of the following ways.
Tax collected by the retailer here in California is called sales tax, and the retailer is responsible for reporting and paying the tax to the state. When an out-of-state or online retailer doesn't collect the tax for an item delivered to California, the purchaser may owe "use tax," which is simply a tax on the use, storage, or consumption of personal property in California.
Items that are exempt from sales tax are exempt from use tax as well. Use tax liabilities are often created by internet or mail order purchases with out-of-state retailers not required to collect the tax. Be sure to review your receipts from Internet and other out-of-state purchases to determine if tax was charged.
The use tax, which was created in July 1935, is a companion to California's sales tax that is designed to level the playing field between in-state retailers who are required to collect tax, and some out-of-state retailers who are not. Use tax, just like sales tax, goes to fund state and local services throughout California.
For questions on whether a purchase is taxable read the California Use Tax Information, or call our Customer Service Center at 1-800-400-7115 (CRS 711).
If you have questions on how to report and pay use tax on the purchase of vehicles, vessels, and aircraft, see our Tax Guide for Purchasers of Vehicles, Vessels, & Aircraft or refer to Publication 79, Documented Vessels and California Tax, or Publication 79-A, Aircraft and California Tax. The use tax due on these purchases cannot be reported on your California state income tax return.
If you are registered with the California Department of Tax and Fee Administration as a cigarette and/or tobacco products consumer, your purchases of cigarette and tobacco products may not be reported on your sales and use tax return. If you need additional information, contact our Customer Service Center at 1-800-400-7115 (CRS 711).
Generally, use tax also applies to foreign purchases of tangible personal property brought into California for storage, use, or other consumption. More information about items brought into California through U. S. Customs is available online.
