California Code of Regulations › Title 18 - Public Revenues › Division 2 - California Department of Tax and Fee Administration- Business Taxes (State Board of Equalization- Business Taxes, See Ch. 6 and 9.9) › Chapter 4 - Sales and Use Tax › Article 20 - Transactions (Sales) and Use Taxes › Section 1827 - Collection of Use Tax by Retailers

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
(a) In General. Except as provided in
				  subdivision (d) below, any retailer engaged in business in a district imposing
				  transactions (sales) and use taxes and making sales of tangible personal
				  property, the storage, use or other consumption of which is subject to the
				  state-administered district use tax imposed by that district is required to
				  register with the Department, collect the use tax from the purchaser, give
				  receipts therefor, and pay the tax to the Department. Retailers to whom
				  seller's permits have been or are issued under section
				  6067
				  of the Revenue and Taxation Code and who are engaged in business in the
				  district are registered to collect the district use tax.
Any retailer who is not engaged in business in the district
					 imposing transactions (sales) and use taxes may voluntarily collect tax from
					 purchasers, give receipts therefor, and pay tax to the Department in the same
					 manner as retailers engaged in business in the district.
(b) When Collection of Use Tax is Required.
(1) Deliveries Into the District. A retailer
				  engaged in business in a district (except retailers of certain vehicles,
				  aircraft and vessels as described in paragraph (c)(2) below) shall not be
				  required to collect district use tax from a purchaser of tangible personal
				  property unless the retailer ships or delivers the property into that district
				  or participates within that district in making the sale of the property,
				  including, but not limited to soliciting or receiving the order, either
				  directly or indirectly, at a place of business of the retailer in the district
				  or through any representative, agent, canvasser, solicitor, subsidiary or
				  person in the district under authority of the retailer.
(2) Presumption of Use--Out-of-District
				  Deliveries. It shall be presumed that tangible personal property (except for
				  certain vehicles, aircraft and vessels described in paragraph (c)(2) below)
				  delivered outside a district imposing transactions (sales) and use taxes to a
				  purchaser known by the retailer to be a resident of a district imposing such
				  taxes was purchased from a retailer for storage, use or other consumption in
				  the district in which the purchaser resides and was stored, used or otherwise
				  consumed in that district. If the retailer is engaged in business in that
				  district and participates within the district in making the sale of the
				  property, the retailer shall collect the district use tax and pay it to the
				  Department.
The presumption may be rebutted and the retailer relieved
					 of the duty of collecting the district use tax if the retailer, in good faith,
					 accepts from the purchaser a statement in writing that the property was
					 purchased for use at a designated point or points outside a district imposing a
					 use tax. The presumption may also be rebutted by other evidence satisfactory to
					 the Department that the property was not purchased for storage, use or other
					 consumption in a district imposing a use tax.
(3) Vehicles, Aircraft and Undocumented
				  Vessels. Retailers of vehicles, aircraft or undocumented vessels described in
				  paragraph (c)(2) below are engaged in business in a district imposing a
				  state-administered district use tax and are required to collect the use tax
				  from the purchaser and pay it to the Department when such vehicles, aircraft or
				  undocumented vessels are registered or licensed in that district.
(4) Trailing Nexus. A retailer engaged in
				  business in the district is required to collect district use tax during any
				  calendar year that it has a physical presence in the district that would be
				  sufficient to establish a substantial nexus with this state for purposes of the
				  Commerce Clause of the United States Constitution, including, but not limited
				  to, a physical presence described in Regulation 1684, subdivision (c)(1), or it
				  meets the threshold for total combined sales of tangible personal property in
				  the state or for delivery in the state set forth in subdivision (c)(3) of this
				  regulation, and during the following calendar year.