How do I correctly calculate, collect, and remit sales tax for products sold within California?

To correctly handle California sales tax, you must obtain a seller's permit, calculate the tax rate based on the delivery location, collect the tax from the customer, and remit it to the state on a set schedule. Here are the steps to correctly manage California sales tax: Step 1: Obtain a Seller's Permit Before you sell any products, you must register for a seller's permit from the California Department of Tax and Fee Administration (CDTFA). You can apply online at the CDTFA website (www.cdtfa.ca.gov). You will need your business details, bank information, and personal identification. Per Revenue and Taxation Code Section 6066, this permit is mandatory for all sellers. Step 2: Determine the Correct Sales Tax Rate The total sales tax rate varies throughout California. It combines the statewide rate (as set by Section 6051) with various district taxes. You must charge the rate applicable at the location where the product is delivered. Use the official "Find a Sales and Use Tax Rate" tool on the CDTFA website for every transaction to ensure accuracy. Step 3: Collect the Sales Tax Add the correct sales tax to the price of the tangible goods you sell. State this tax as a separate item on the customer's invoice or receipt. You are responsible for collecting this tax at the time of the sale. Step 4: File a Return and Remit the Tax The CDTFA will assign you a filing frequency (quarterly, monthly, or annually). You must file a sales and use tax return and remit the taxes you collected by the due date for that period, even if you had no sales. You can file and pay electronically on the CDTFA website. Deadlines are firm; for quarterly filers, the due date is typically the last day of the month following the end of the quarter. Important considerations: You must keep detailed records of all gross receipts, sales transactions, and taxes collected for at least four years. Tax rates can change, so verify them regularly. Note: Failure to remit collected sales tax can lead to significant penalties and legal consequences. The CDTFA is strict about enforcement and deadlines. This is general information and does not constitute legal advice. For complex situations, such as selling a mix of taxable and non-taxable items, consult with a qualified California attorney or a Certified Public Accountant (CPA).