salient domain was triggered too early. This is usually an indicator for some code in the plugin or theme running too early. Translations should be loaded at the init action or later. Please see Debugging in WordPress for more information. (This message was added in version 6.7.0.) in /home/booksandbalances/public_html/blog/wp-includes/functions.php on line 6121To understand the sales tax rate on commercial rental properties in Florida, it is important to familiarize oneself with the state’s sales tax laws. The Florida Department of Revenue imposes a <\/span>5.5%\u00a0sales tax<\/a><\/strong> on rentals and leases for commercial properties. This includes any agreement where a tenant pays consideration (money or anything else of value) for the right to occupy or use real property.<\/span><\/p>\n It is worth noting that while many may assume that residential rentals are exempt from sales tax, this is not always the case in Florida. Additional taxes may apply if certain services such as cleaning, linen changes, or other amenities are provided along with a residential rental. Landlords must carefully evaluate their situation and consult a tax professional if necessary to ensure compliance with all applicable laws.<\/span>[\/vc_column_text][\/vc_column_inner][\/vc_row_inner][vc_column_text text_direction=”default”]The sales tax on commercial rentals is calculated based on the total rent charged for each lease period. However, there are certain exemptions that landlords should be aware of which can impact their obligations. For example, agricultural leases lasting over six months are exempt from sales tax entirely. Similarly, government agencies and nonprofit organizations leasing commercial space are also typically exempt from paying sales tax.<\/span><\/p>\n When it comes to understanding the Florida sales tax rate on commercial rentals, it is crucial to clearly define what constitutes a commercial rental property. In simple terms, a commercial rental refers to any space that is leased or rented for business purposes. This can include office buildings, retail stores, warehouses, and other spaces used for profit-generating activities.<\/span><\/p>\n It’s important to note that residential properties do not fall under the category of commercial rentals. If you rent out an apartment complex or single-family home for residential purposes only, they are exempt from the sales tax on commercial rentals. However, if you convert your residential property into mixed-use (partially residential and partially nonresidential), be aware that the portion of the space used for nonresidential purposes will be subject to sales tax.<\/span><\/p>\n Understanding this distinction between residential and nonresidential properties is crucial as it significantly affects your tax obligations and potential exemptions. By accurately categorizing your properties as either commercial or residential rentals, you can ensure compliance with Florida’s sales tax laws while avoiding unnecessary financial burdens.<\/span>[\/vc_column_text][\/vc_column][\/vc_row][vc_row type=”in_container” full_screen_row_position=”middle” column_margin=”default” column_direction=”default” column_direction_tablet=”default” column_direction_phone=”default” scene_position=”center” text_color=”dark” text_align=”left” row_border_radius=”none” row_border_radius_applies=”bg” overflow=”visible” overlay_strength=”0.3″ gradient_direction=”left_to_right” shape_divider_position=”bottom” bg_image_animation=”none”][vc_column column_padding=”no-extra-padding” column_padding_tablet=”inherit” column_padding_phone=”inherit” column_padding_position=”all” column_element_direction_desktop=”default” column_element_spacing=”default” desktop_text_alignment=”default” tablet_text_alignment=”default” phone_text_alignment=”default” background_color_opacity=”1″ background_hover_color_opacity=”1″ column_backdrop_filter=”none” column_shadow=”none” column_border_radius=”none” column_link_target=”_self” column_position=”default” gradient_direction=”left_to_right” overlay_strength=”0.3″ width=”1\/1″ tablet_width_inherit=”default” animation_type=”default” bg_image_animation=”none” border_type=”simple” column_border_width=”none” column_border_style=”solid”][nectar_global_section id=”229″][\/vc_column][\/vc_row][vc_row type=”full_width_background” full_screen_row_position=”middle” column_margin=”default” equal_height=”yes” content_placement=”middle” column_direction=”default” column_direction_tablet=”default” column_direction_phone=”default” scene_position=”center” text_color=”dark” text_align=”left” row_border_radius=”none” row_border_radius_applies=”bg” overflow=”visible” id=”sec4″ overlay_strength=”0.3″ gradient_direction=”left_to_right” shape_divider_position=”bottom” bg_image_animation=”none” gradient_type=”default” shape_type=””][vc_column column_padding=”no-extra-padding” column_padding_tablet=”inherit” column_padding_phone=”inherit” column_padding_position=”all” column_element_direction_desktop=”default” column_element_spacing=”default” desktop_text_alignment=”default” tablet_text_alignment=”default” phone_text_alignment=”default” background_color_opacity=”1″ background_hover_color_opacity=”1″ column_backdrop_filter=”none” column_shadow=”none” column_border_radius=”none” column_link_target=”_self” column_position=”default” gradient_direction=”left_to_right” overlay_strength=”0.3″ width=”1\/1″ tablet_width_inherit=”default” animation_type=”default” bg_image_animation=”none” border_type=”simple” column_border_width=”none” column_border_style=”solid”][vc_column_text text_direction=”default”]\n As of now, the state sales tax rate on commercial rentals in <\/span>Florida is 4.5 percent<\/a><\/strong>. This rate applies not only to the base rent but also to “constructive rent,” which includes pass-through expenses like insurance, mortgage payments, or ad valorem taxes that tenants pay on behalf of property owners.<\/span><\/p>\n In the state of Florida, sales tax applies to commercial rentals. This means that if you lease or rent out a commercial property, you are required to collect and remit sales tax on the rental amount. The current sales tax rate for commercial rentals in Florida is 4.5 %. However, it’s important to note that this rate may be subject to change, so it’s advisable to stay updated with any updates from the Florida Department of Revenue.<\/span><\/p>\n Calculating the sales tax on a commercial rental is fairly straightforward. You simply multiply the total rent charged by the applicable tax rate (in this case, 5.5 %).\u00a0<\/span><\/p>\n For example<\/b>, if your monthly rent is $1,500, you would need to collect and remit an additional $82.5 as sales tax ($1,500 x 0.055).<\/span><\/p>\n It’s worth mentioning that there are instances where certain exemptions may apply when it comes to charging sales tax on commercial rentals. One such exemption is for leases longer than six months or where there is an option for renewal beyond six months. In these cases, instead of collecting and remitting monthly taxes throughout the lease period, landlords have the option to pay upfront use tax based on projected collections until either six months elapse or there becomes no possibility of renewal.<\/span>[\/vc_column_text][vc_column_text text_direction=”default”]\n Governor DeSantis <\/span>signed House Bill 7063<\/span>, ushering in a significant change in the sales tax rate on commercial leases. Effective from December 1, 2023, the new rate is reduced to 4.5 percent. However, it’s essential to note that local option sales surtaxes still apply, resulting in an effective commercial rental rate that can range from as high as six percent to as low as five percent.<\/span><\/p>\n The impact of local option sales surtaxes varies by county. Here is a breakdown of the surtax rates in different Florida counties:<\/span><\/p>\nDefinition of Commercial Rentals<\/b><\/h2>\n
Current Sales Tax Rate<\/b><\/h2>\n
Application of Sales Tax to Commercial Rentals<\/b><\/h2>\n
Recent Legislative Changes<\/b><\/h2>\n
County-wise Surtax Rates<\/b><\/h2>\n