Florida sales tax guide
All you need to know about sales tax in the Sunshine State
Sales tax 101
Sales tax is a tax paid to a governing body (state or local) for the sale of certain goods and services. Florida first adopted a general state sales tax in 1949, and since that time, the rate has risen to 6 percent. On top of the state sales tax, there may be one or more local sales taxes which can range between 0.10 and 2 percent. Currently, combined sales tax rates in Florida range from 6.3 to 8.3 percent, depending on the location of the sale.
As a business owner selling taxable goods or services, you act as an agent of the state of Florida by collecting tax from purchasers and passing it along to the appropriate tax authority. As of November 2018, sales and use tax in Florida is administered by the Florida Department of Revenue (DOR).
Any sales tax collected from customers belongs to the state of Florida, not you. It’s your responsibility to manage the taxes you collect to remain in compliance with state and local laws and avoid penalty and interest payments.
When you need to collect Florida sales tax
In Florida, sales tax is collected on the sale of tangible goods and some services. The tax is collected by the seller and remitted to state and local tax authorities. The seller acts as a de facto tax collector.
To help you determine whether you need to collect sales tax in Florida, we've created a simple three-step checklist you can use to get a better understanding of your Florida tax situation:
- Do you have nexus in Florida?
- Are you selling taxable goods or services to Florida residents?
- Are your buyers required to pay sales tax?
If the answer to all three questions is yes, then you’re required by the Florida Department of Revenue to collect, file, and remit sales tax.
Failure to collect Florida sales tax
If you meet the criteria for collecting sales tax (nexus in Florida and selling taxable goods or services to taxable residents) and choose not to collect sales tax, you’ll be held responsible for the tax due, plus applicable penalties and interest.
It’s extremely important to set up tax collection at the point of sale — it’s near impossible to collect sales tax after a transaction is complete.
Sales tax nexus
The need to collect sales tax in Florida is predicated on having a significant connection with the state. This is a concept known as nexus. Nexus is a Latin word that means "to bind or tie," and it’s the deciding factor for whether the Florida Department of Revenue has the legal authority to require your business to collect, file, and remit sales tax.
Sales tax nexus in all states used to be limited to physical presence: A state could require a business to collect and remit sales tax only if it had a physical presence in the state, such as employees or an office, retail store, or warehouse.
In June 2018, the Supreme Court of the United States overruled the physical presence rule in South Dakota v. Wayfair, Inc. States are now free to tax businesses based on their economic and virtual connections to the state, or economic nexus.
Sales tax nexus in Florida is still largely linked to physical presence. However, it’s still possible for out-of-state sellers to have sales tax nexus with Florida.
Out-of-state sellers with no physical presence in Florida can establish sales tax nexus in the following ways:
Affiliate nexus: Having ties to businesses or affiliates in Florida. This includes, but isn’t limited to, the design and development of tangible personal property (goods) sold by the remote retailer, or solicitation of sales of goods on behalf of the retailer.
Click-through nexus: Having an agreement to reward a person(s) in the state for directly or indirectly referring potential purchasers of goods through an internet link, website, or otherwise. At this time, Florida has not enacted a click-through nexus law.
Inventory in the state: Storing property for sale in the state. This includes merchandise owned by Fulfillment by Amazon (FBA) merchants and stored in Florida in a warehouse owned or operated by Amazon. Florida asserts that ownership of real or tangible personal property located in the state is a nexus-creating activity.
Trade shows: Attending conventions or trade shows in Florida. You may be liable for collecting and remitting Florida sales or use tax on orders taken or sales made during Florida conventions or trade shows. However, you generally would not have nexus if the written agreement between the sponsor and exhibitor:
- Prohibits the sale of tangible personal property or services; or
- Limits the exhibitor to only make sales for resale
For more information, see Fla. Stat.§212.0596(2)(j) and Sales and Use Tax on Trade Show and Convention Exhibitors.
If you have sales tax nexus with Florida, you’re required to register with the Florida Department of Revenue and to charge, collect, and remit the appropriate tax to the state.
Sales tax nexus can linger even after a retailer ceases the activities that caused it to be “engaged in business” in the state. This is known as trailing nexus. Florida does not have an explicitly defined trailing nexus policy as of November 2018.
Fulfillment by Amazon (FBA)
If you’re an active Amazon seller and you use Fulfillment by Amazon (FBA), you need to know where your inventory is stored and if its presence in a state will trigger nexus. The Avalara TrustFile FBA Inventory Report can help demystify FBA shipping and storage patterns. FBA sellers can also download an Inventory Event Detail Report from Amazon Seller Central to identify inventory stored in Florida.
If you sell taxable goods to Florida residents and have inventory stored in the state, you likely have nexus and an obligation to collect and remit tax. We recommend you work with a tax professional to determine whether you have Florida nexus. The team at Avalara Professional Services can help get you started.
Sourcing sales tax in Florida: which rate to collect
In some states, sales tax rates, rules, and regulations are based on the location of the seller and the origin of the sale (origin-based sourcing). In others, sales tax is based on the location of the buyer and the destination of the sale (destination-based sourcing).
Florida generally uses destination sourcing. In-state and collecting out-of-state dealers must collect the sales tax rate in effect where the transaction or delivery occurs.
However, the Florida Department of Revenue has required Florida florists to collect the rate in effect at their place of business on their sales to customers located in other states.
After determining you have sales tax nexus in Florida, you need to register with the proper state authority and collect, file, and remit sales tax to the state. We get a lot of questions regarding this and recognize it may be the most difficult hurdle for businesses to overcome. Avalara Licensing can help you obtain your Florida business license and sales tax registration.
How to register for a Florida seller's permit
You can register for a Florida Business Tax License online through the Florida Department of Revenue. To apply, you’ll need to provide the Florida DOR with certain information about your business, including but not limited to:
- Business name, address, and contact information
- Federal EIN number
- Date business activities began or will begin
- Projected monthly sales
- Projected monthly taxable sales
- Products to be sold
Cost of registering for a Florida seller's permit
There is currently no cost to register for a Florida Business Tax License.
Acquiring a registered business
You must register with the Florida DOR if you acquire an existing business in Florida. The state requires all registered businesses to have the current business owner’s name and contact information on file.
Streamlined Sales Tax (SST)
The Streamlined Sales and Use Tax Agreement (SSUTA), or Streamlined Sales Tax (SST), is an effort by multiple states to simplify the administration and cost of sales and use tax for remote sellers. Remote sellers can register in multiple states at the same time through the Streamlined Sales Tax Registration System (SSTRS).
As of November 2018, Florida is not an SST member state.
Collecting sales tax
Once you've successfully registered to collect Florida sales tax, you'll need to apply the correct rate to all taxable sales, remit sales tax, file timely returns with the Florida DOR, and keep excellent records. Here’s what you need to know to keep everything organized and in check.
How you collect Florida sales tax is influenced by how you sell your goods:
Brick-and-mortar store: Have a physical store? Brick-and-mortar point-of-sale solutions like Revel allow users to set the sales tax rate associated with the store location. New tax groups can then be created to allow for specific product tax rules.
Hosted store: Hosted store solutions like Shopify or Squarespace offer integrated sales tax rate determination and collection. Hosted stores offer sellers a dashboard environment where Florida sales tax collection can be managed.
Marketplace: Marketplaces like Amazon or Etsy offer integrated sales tax rate determination and collection, usually for a fee. As with hosted stores, you can set things up from your seller dashboard and let your marketplace provider do most of the heavy lifting.
Mobile point of sale: Mobile point-of-sale systems like Square rely on GPS to determine sale location. The appropriate tax rate is then determined and applied to the order. Specific tax rules can be set within the system to allow for specific product tax rules.
Florida sales tax collection can be automated to make your life much, much easier. Avalara AvaTax seamlessly integrates with the business systems you already use to deliver sales and use tax calculations in real time.
Some goods are exempt from sales tax under Florida law. Examples include most non-prepared food items, food stamps, and medical supplies.
We recommend businesses review the laws put forth by the Florida Department of Revenue and stay up to date on which goods are taxable and which are exempt, and under what conditions.
Some customers are exempt from paying sales tax under Florida law. Examples include government agencies, some nonprofit organizations, and merchants purchasing goods for resale.
Sellers are required to collect a valid exemption or resale certificate from buyers to validate each exempt transaction.
Misplacing a Florida sales tax exemption/resale certificate
Florida sales tax exemption and resale certificates are worth far more than the paper they’re written on. If you’re audited and cannot validate an exempt transaction, the Florida Department of Revenue may hold you responsible for the uncollected sales tax. In some cases, late fees and interest will be applied and can result in large, unexpected bills.
Sales tax holidays
Sales tax holidays exempt specific products from sales and use tax for a limited period of time, usually a weekend or a week. Approximately 17 states offer sales tax holidays every year.
Florida often provides one or more sales tax holidays, but they’re not set to recur annually; they need to be established each year by the Florida Legislature. Common Florida sales tax holidays include:
- Back-to-school tax holiday: August
- Disaster preparedness tax holiday: June
Filing and remittance
You're registered with the Florida Department of Revenue and you've begun collecting sales tax. Remember, those tax dollars don't belong to you. As an agent of the state of Florida, your role is that of intermediary to transfer tax dollars from consumers to state and local tax authorities.
How to file
Once you’ve collected sales tax, you’re required to remit it to the Florida DOR by a certain date. The Florida DOR will then distribute it to the appropriate state and local agencies.
Filing a Florida sales tax return is a two-step process comprised of submitting the required sales data (filing the return) and remitting the collected tax dollars (if any) to the Florida Department of Revenue. The filing process forces you to detail your total sales in the state, the amount of sales tax collected, and the location of each sale.
You may complete Florida sales tax returns on paper and mail them to the Florida DOR, or file returns electronically online through the Florida DOR site. Online filing is generally recommended.
The Florida DOR will assign you a filing frequency. Typically, this is determined by the size or sales volume of your business. State governments generally ask larger businesses to file more frequently. See the Filing due dates section for more information.
Florida sales tax returns and payments must be remitted at the same time; both have the same due date.
Filing online is generally preferred over filing paper returns. You may file directly with the Florida DOR by visiting their site and entering your transaction data manually. This is a free service, but preparing Florida sales tax returns can be time-consuming — especially for larger sellers.
Using a third party to file returns
To save time and avoid costly errors, many businesses outsource their sales and use tax filing to an accountant, bookkeeper, or sales tax automation company like Avalara. This is a normal business practice that can save business owners time and help them steer clear of costly mistakes due to inexperience and a lack of deep knowledge about Florida sales tax code.
Avalara TrustFile provides a quick and easy way to prepare and efile sales tax returns. Users can sign up and use the service to prepare returns for free for a limited time.
Filing when there are no sales
Once you have a Florida seller's permit, you’re required to file returns at the completion of each assigned collection period regardless of whether any sales tax was collected. When no sales tax was collected, you must file a "zero return.”
Failure to submit a zero return can result in penalties and interest charges.
Closing a business
The Florida DOR requires all businesses to "close their books" by filing a final sales tax return. This also holds true for business owners selling or otherwise transferring ownership of their business.
Timely filing discount
When returns are filed early or on time, the Florida Department of Revenue currently offers a vendor discount (also known as a dealer collection allowance) of 2.5 percent of the first $1,200 of tax due, with a maximum of $30 per report.
Filing due dates
It's important to know the due dates associated with the filing frequency assigned to your business by the Florida Department of Revenue. This way you'll be prepared and can plan accordingly. Failure to complete filing by the assigned date can lead to fines and interest charges.
The Florida Department of Revenue requires all sales tax filing to be completed by the 20th of the month following the assigned filing period. Below, we've grouped Florida sales tax due dates by filing frequency for your convenience. Due dates falling on a weekend or holiday are adjusted to the following business day.
For returns filed electronically, your payment must be submitted at least 24 hours prior to the assigned due date. For that reason, the due dates noted below are all set for the 19th of the month, or the adjusted weekend or holiday due date.
Florida 2018 monthly filing due dates
|Reporting period||Filing deadline|
|January||February 16, 2018
|Febuary||March 19, 2018
|March||April 19, 2018
|April||May 18, 2018
|May||June 19, 2018
|June||July 19, 2018
|July||August 17, 2018
|August||September 19, 2018
|September||October 19, 2018
|October||November 19, 2018
|November||December 19, 2018
|December||January 18, 2019
Florida 2018 quarterly filing due dates
|Reporting period||Filing deadline|
|Q1||April 19, 2018
|Q2||July 19, 2018
|Q3||October 19, 2018
|Q4||January 18, 2019
Florida 2018 semi-annual filing due dates
|Reporting period||Filing deadline|
|1st half||January 19, 2018
|2nd half||January 18, 2019
Florida 2018 annual filing due dates
|Reporting period||Filing deadline|
|2018 (month varies for some states)
||January 18, 2019
Filing a Florida sales tax return late may result in a late filing penalty as well as interest on any outstanding tax due. For more information, refer to our section on Penalties and interest.
In the event a Florida sales tax filing deadline was missed due to circumstances beyond your control (e.g., weather, accident), the Florida DOR may grant you an extension. However, you may be asked to provide evidence supporting your claim.
Penalties and interest
Hopefully you don't need to worry about this chapter because you're filing and remitting Florida sales tax on time and without incident. However, in the real world, mistakes happen.
If you miss a sales tax filing deadline, follow the saying, “better late than never,” and file your return as soon as possible. Failure to file returns and remit collected tax on time may result in penalties and interest, and the longer you wait to file, the greater the penalty and the greater the interest.
If you’re in the process of acquiring a business, it’s strongly recommended that you contact the Florida DOR and inquire about the current status of the potential acquisition. Once you've purchased the business, you’ll be held responsible for all outstanding Florida sales and use tax liability.
Shipping and handling
Because Florida is one of the largest states in the Union, most businesses have customers in the Sunshine State. If you’re collecting sales tax from Florida residents, you’ll need to consider how to handle taxes on shipping and handling charges.
Taxable and exempt shipping charges
Florida sales tax may apply to charges for shipping, delivery, freight, handling, and postage (transportation charges).
The general rule of thumb in Florida is that transportation charges are taxable when they’re included in the sales price of taxable tangible personal property (i.e., not separately stated on an invoice or bill of sale). Transportation charges that cannot be avoided are also taxable, even if separately stated.
However, transportation charges that can be avoided (e.g., by having the purchaser arrange for pickup and delivery of the goods themselves) are exempt if separately stated on the invoice or bill of sale. Transportation charges are also exempt when a purchaser decides to contract with a third-party carrier and pays transportation charges directly to the third-party carrier.
Sales tax may also apply to certain drop-shipping scenarios. In general, sales tax applies when goods are drop-shipped:
- To a dealer’s Florida customer from a seller’s facility in Florida; or
- To a Florida customer from a seller’s facility outside Florida if the seller uses its own transportation; or
- From a seller’s facility outside Florida if the terms of delivery require the drop-shipper to collect the sales price from the Florida customer.
Sales tax also generally applies when the seller is a Florida manufacturer and the buyer is an unregistered out-of-state dealer unable to furnish a Florida annual resale certificate for sales tax.
The Florida Department of Revenue recommends keeping clear invoices and records for all transactions. Records must reflect the total gross receipts from all sales, rentals, leases, taxable services, and taxable labor, as well as the total purchases of taxable items. Additional records must be kept to validate deductions, exclusions, or exemptions.
There are exceptions to almost every rule with sales tax, and the same is true for shipping and handling charges. Specific questions on shipping in Florida and sales tax should be taken directly to a tax professional familiar with Florida tax laws. Avalara Professional Services can help.
Register your business to collect sales tax