Country / Language

San Francisco Gross Receipts Tax and Payroll Expense Tax Installments Due April 30


4/28/14

Synopsis
 
San Francisco’s new gross receipts tax (GRT) will phase in over a five-year period that began on January 1, 2014. The first installment payment for the GRT is due April 30, 2014.
 
Issue
 
Beginning in 2014, the GRT will apply to every person (including incorporated and unincorporated entities) engaged in business in the city of San Francisco and will be based on a taxpayer’s gross receipts that are attributable to San Francisco. The GRT is payable in four quarterly installments: April 30, July 31, and October 31 of the current taxable year, and the last day of February of the following tax year.
 
Under the new GRT, gross receipts include all amounts received or accrued by a person from any source including, but not limited to, a taxpayer’s gross income for federal income tax purposes. Gross receipts do not include certain “investment receipts” such as interest, dividends, capital gains, and other receipts that are derived from capital investments. Gross receipts also do not include distributions from a pass-through entity if those distributions are attributable to an investment in that pass-through.
 
The GRT is imposed only on the portion of gross receipts that are attributed to San Francisco. The GRT tax rate will vary depending on the business that the taxpayer is engaged in.
 
Currently, businesses operating in San Francisco are subject to a payroll expense tax (1.35% in 2014) on all compensation paid to individuals performing services. This tax will be phased out gradually during the five-year GRT phase-in period.
 
What Does CohnReznick Think?
Taxpayers doing business in San Francisco should ensure that they understand the Gross Receipts Tax rules and timely pay and file any taxes and returns due.

Contact
 
For more information, please contact Patrick Duffany, Partner and State and Local Tax Practice Leader, at 860-368-3607 or Henry Chiwaya, Senior Manager, State and Local Tax Practice, at 301-280-1812.
 
To learn more about CohnReznick’s State and Local Tax practice, please visit our webpage.


Circular 230 Notice: In compliance with U.S. Treasury Regulations, the information included herein (or in any attachment) is not intended or written to be used, and it cannot be used, by any taxpayer for the purpose of i) avoiding penalties the IRS and others may impose on the taxpayer or ii) promoting, marketing, or recommending to another party any tax related matters.

This has been prepared for information purposes and general guidance only and does not constitute professional advice. You should not act upon the information contained in this publication without obtaining specific professional advice. No representation or warranty (express or implied) is made as to the accuracy or completeness of the information contained in this publication, and CohnReznick LLP, its members, employees and agents accept no liability, and disclaim all responsibility, for the consequences of you or anyone else acting, or refraining to act, in reliance on the information contained in this publication or for any decision based on it.

Search Our People

Search Our People

Look ahead. Gain insight. Imagine more. Is your business ready to break through?

View our new TV commercial..

Industry Outlooks

Industry Outlooks

Gain insight into what is ahead for the Commercial Real Estate, Technology and Middle Market Private Equity industries.

READ MORE

Learn about our upcoming events.

READ MORE

Working With Us

Working With Us

What makes CohnReznick different from others in our profession? And what should our clients come to expect when working with us? The answer is The CohnReznick Advantage. Contact us to learn how we can out the CohnReznick Advantage to work for your business.


People

The value of an organization is determined by the skills and qualities of its leaders. With more than 280 partners serving clients nationwide, CohnReznick is renowned for the diverse experiences, knowledge and backgrounds of its leadership.

Learn More

Services

We align our services in three segments: Accounting and Assurance, Tax, and Advisory. This approach allows us to provide holistic solutions to complex business problems and to seize upon opportunities requiring an integrated approach.

Learn More

Industries

Accounting and tax issues different significantly based on an organization's industry. We provide clients with expertise in nearly two dozen industries – we know the opportunities, the obstacles, the competitive landscape.

Learn more

Insights

CohnReznick professionals are thought leaders in their industries. Clients benefit from relevant and timely economic, legislative and industry insights that can keep them a step ahead of competition.

Learn More

Global Reach

Our involvement in the Nexia International network of firms enables us assist our clients wherever they do business-providing local expertise and connections wherever they needed. Nexia is comprised of 20,000 professionals operating in over 100 countries.

Learn More