Having a hard time dealing with Sales Tax in California? Don't Worry! This guide is just for you. Our experts have researched and worked days and nights to bring you a straightforward California Sales Tax Calculator, followed by a comprehensive guide.
Businesses and Sellers who have nexus in California collect sales tax on tangible personal property. They are required to collect, manage, and transfers it to the California Department of Tax and Fee Administration (CDTFA) while staying in compliance with state laws and avoid penalties and interest.
The sales tax determined on three factors:
To calculate Sales Tax in California, follow the steps below:
You, as a Business owner, are only required to collect sales tax if you have Sales Tax Nexus in the California State. And to determine your Nexus in California, you must have any of the following:
Once you have determined that your Nexus is with California, next is to deduce the Sales Tax rate (State + Local Sales Tax) applicable on your product, for which you can refer the tables below:
The state-wide Sales Tax rate in California is 6% plus 1.5% of mandatory local sales tax. Besides, many cities and counties levy additional local sales tax on tangible personal property and certain services. Following are the Sales Tax rate on State, County, and city level in California:
|County||State Rate||County Rate||Total Sales Tax|
|San Luis Obispo||7.25%||0%||7.250%|
After the determination of the Sales Tax rate according to the location and type of purchases, it is easy to calculate the sales tax amount charged on the product and gross price (amount after tax) of a product.
Example # 1:
For instance, you are selling a fan on your store in Bakersfield, California, having a net price tag of $100. The amount that a buyer has to pay (including sales tax) on a check out would be:
Net Price (amount before Tax) of a Fan: $100
Total Sales Tax rate: 1% (Bakersfield) + 0% (Kern County) + 7.25% (California State) = 8.25%
Total Sales Tax amount = $100 x 8.25% = $8.25
Gross Price (Amount after Tax) = 100 + 8.25 = $108.25
It means the amount the buyer has to pay for a Fan on a cash counter would be $108.25.
Using our Sales Tax Calculator:
All of the steps mentioned above can be skipped to get an instant result using our Sales Tax Calculator. All you need is:
Our calculator will automatically calculate the result, and represents it in 3 different forms, as shown in the image below:
In the example above, we have explained to you to calculate the Sales Tax amount payable in a product, and the Gross Price of the Product.
But there are also instances when you are required to deduce how much sales tax buyer has actually paid on a product or you may want to check the accuracy of the sales tax indicated on your item's receipt.
This is where the Reverse Sales Tax Calculation Kicks in. And luckily, our California Sales Tax Calculator can perform this calculation like a Pro.
Your buyer has paid $525 for a Refrigerator at your store in San Jose, California. Now the buyer is inquiring how much the Refrigerator actually cost before the sales tax was added. So you need to follow the steps below to determine the amount before tax (net price) of a Refrigerator:
Gross Price (Amount after Tax) of Refrigerator: $525
Total Sales Tax rate: 0.250% (San Jose) + 1.750% (Santa Clara County) + 7.25% (California State) = 9.250%
Gross Price with sales tax = [Net Price × (tax rate in decimal form + 1)]
525 = [Net Price x ((9.250/100) + 1)]
525 = Net Price x 1.09
$481.7 = Net Price
So the original Price (net price) of the Refrigerator was $481.7.
Using our Sales Tax Calculator:
You can also use our Sales Tax Calculator for Reverse Sales Tax calculation to skip the above mentioned manual method. All you need is:
Our calculator will automatically calculate the result and represents it in 3 different forms.
Answer: The basic sales tax rate levied on the state level in California is 6%. Besides, 1.5% is levied as a mandatory local sales tax. On top of that, most of the counties and cities in California levy a local income tax, which varies from location to location.
Answer: Santa Fe Springs, California, has the highest sales tax rate of 10.5%.
Answer: Los Angeles, California, has the lowest sales tax rate of 6.5%.
Answer: Prescription Drugs, "unprepared" Food, hot beverages and bakery items, food animals (livestock), fertilizer used to grow food, specific medical supplies, energy utilities, and few more are exempted from California Sales Tax.
Answer: No, Groceries are exempted from sales tax in California