The 911 Surcharge will be due on each retail transaction that involves a sale of prepaid MTS to a California consumer, unless otherwise exempt.
Sellers of prepaid mobile telephony services (MTS), such as prepaid minutes and airtime, have certain surcharge and local charge collection requirements.īeginning January 1, 2020, sellers of prepaid mobile telephony services (MTS) will be required to collect, report, and pay the Emergency Telephone Users (911) Surcharge as a flat fee on each purchase of prepaid MTS made by a prepaid MTS consumer. Service and/or data plans that do not include mobile phone, tablets or other wireless devices are not taxable. Generally, one-time activation fees for a new mobile phone or wireless device for which you make a separate charge on the invoice or contract are not taxable. If you make a separate charge for the accessories and the sales price is less than 50 percent of your cost, you must pay tax on your cost of the accessories and you cannot collect sales tax from your customer. If you make a separate charge for the accessories and the sales price is at least 50 percent of your cost, you must pay tax on the separately stated sales price and you may collect the sales tax from your customer. If you have suggestions for improving this guide, please contact us via email. Contact information and hours of operation are available in the Resources section.
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If at any time you need assistance with topics included in this guide – or with topics not included – feel free to contact us by telephone or email. Please note that this information included is general in nature and is not intended to replace any law or regulation. Lastly, the Resources section provides links to a wealth of information, including web-based seminars, forms and publications, statutory and regulatory information, and access to live help from our customer service representatives. The Getting Started section provides key resources related to registration, filing returns, account maintenance and other important information you need. The Industry Topics section covers many topics, each in an at-a-glance format that can be expanded to provide more extensive information if you need it.
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How to Use This GuideĮach section of this guide contains information important to your business. To help you better understand the tax obligations for the cell phone and wireless device industry, we have created this guide to tax issues and information important to your business. We recognize that understanding tax issues related to your industry can be time-consuming and complicated, and want to help you get the information you need so that you can focus on your starting and growing your business. Taxes you collect and pay to the state help fund state and local services and programs important to you and your community. Helping your business succeed is a key goal of the California Department of Tax and Fee Administration (CDTFA).
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