Florida Communications Services Tax

Sales of communications services in Florida are taxable, unless specifically exempt. Communications services are defined as voice, data, audio, video, or any other information or signals, transmitted by any medium. Communications services subject to tax include, but are not limited to:

• Local, long distance, and toll telephone
• Voice over Internet Protocol (VoIP) telephone
• Video service (for example, television programming or streaming), whether provided by a cable, telephone, or other communications services provider
• Direct-to-home satellite
• Mobile communications
• Private line services
• Pager and beeper
• Telephone charges made at a hotel or motel
• Facsimiles (fax), when not provided in the course of professional or advertising service
• Telex, telegram, and teletype

Dealers should not collect taxes on exempt sales of communications services. Exempt transactions include:

• Sales for resale when made by a registered dealer and properly documented
• Sales or purchases of Internet access, including purchases of communications services used to provide Internet access (See Tax Information Publication #10A19-08 )
• Sales to federal agencies, the state, any county or municipality, or other political subdivision
• Sales to religious and educational organizations with 501(c)(3), Internal Revenue Code (IRC) status
• Sales to homes for the aged with 501(c)(3), IRC status and that meet certain provisions

Examples of documentation needed:

Customer	Documentation Needed
Government	Written evidence, per Rule 12A-19.042, Florida Administrative Code (F.A.C.)
Religious and educational organizations, and homes for the aged with 501(c)(3), IRC status	Written evidence, per Rule 12A-19.043, F.A.C.
Resale	Copy of the Florida Annual Resale Certificate for Communications Services Tax, or telephone or online transaction or vendor authorization number. For more information, see the section below titled Annual Resale Certificate.

The Florida communications services tax includes state tax and gross receipts taxes. The total tax rate for the Florida communications services tax is 7.44%. The state tax rate is 4.92%. The total rate for the gross receipts tax is 2.52%, comprised of a .15% rate and a 2.37% rate. (The gross receipts taxes on communications services is imposed under Chapter 203, Florida Statutes [F.S.], but administered under Chapter 202, F.S.)

Dealers may bill and collect the 4.92% state tax rate along with the .15% gross receipts tax rate (a total of 5.07%) as "state tax" provided the amounts are properly reflected on the tax return. (See section "Partial Exemption for some Residential Services")

The Florida communications services tax must be separately itemized on the customer billing. Dealers must add the Florida communications services tax to the price of the communications services sold. Dealers may not absorb or relieve the customer of all or any part of the Florida communications services tax.

Local Communications Services Tax

Each local taxing jurisdiction (municipality, charter county, or unincorporated county) has a specific local tax rate. A list of all the current and past local jurisdictional rates is available to download. For a list of current local rates only, see the Jurisdiction Tax Rate Table.

The local communications services tax must be separately itemized on the customer billing. Dealers must add the local communications services tax to the price of the communications services sold. Dealers may not absorb or relieve the customer of all or any part of the local communications services tax.

Total Communications Services Tax

The total communications services tax rate is the state rate, gross receipts rates, and the local tax rate combined.

Direct-to-Home Satellite Rates

Direct-to-home satellite (DTHS) has tax rates different from communications services tax rates specified above. It is taxed at a state rate of 9.07% plus 2.37% gross receipts tax, for a total rate of 11.44%. Local tax does not apply to this service.

Florida communications services tax that applies to direct-to-home satellite service must be separately itemized on the customer bill. Dealers must add the communications services tax to the price of the communications services sold. Dealers may not absorb or relieve the customer of all or any part of the communications services tax.

Examples of how tax rates apply to services:

• Local, long distance, VoIP, and toll telephone services are taxed at the total Florida rate of 7.44%, plus applicable local tax rate. The 7.44% portion is comprised of the state rate of 4.92% plus the total gross receipts tax rate of 2.52% (.15% plus 2.37%). However, some services sold to a residential household are exempt from the 4.92% state tax and .15% gross receipts tax.
• Mobile communications and video services are taxed at the total Florida rate of 7.44%, plus applicable local tax rate. There is no residential exemption.
• Telephone charges made at a hotel or motel and fax services are taxed at the total Florida rate of 7.44%, plus applicable local tax rate. There is no residential exemption.
• Direct-to-home satellite service is taxed at a state rate of 9.07% plus 2.37% gross receipts tax for a total of 11.44%. There is no local tax and no residential exemption.

Communications services sold to a residential household are exempt from the 4.92% state tax and the .15% gross receipts tax. Residential service is subject to the 2.37% gross receipts tax and local tax.

This partial exemption does not apply to the sale of mobile communications service, video service, direct-to-home satellite service, or any residence that constitutes all or part of a transient public lodging establishment as defined in Chapter 509, Florida Statutes.

Upon initial registration, dealers will be sent a Florida Annual Resale Certificate for Communications Services Tax (Form DR-700015) and their Certificate of Registration (Form DR-700014). This annual resale certificate is separate from the one issued for sales tax. The resale certificate may only be used to make tax-exempt purchases of communications services that will be resold. Certificates expire on December 31 of each year. Registered, active dealers are issued a new resale certificate annually.

Registered, active dealers who electronically file their tax returns are required to print their own certificate. Dealers who file paper returns will be mailed a new certificate each year in mid-November.

All registered, active dealers, regardless of how they file returns, may access their certificate through the communications services tax online application (log in is required). Once logged in, the annual resale certificate may be downloaded and printed or saved by selecting the "Print Annual Resale Certificate" button.

Here are some points for selling dealers to remember about accepting a Florida Annual Resale Certificate for Communications Services Tax:

• Selling dealers must document all exempt sales for resale. You can document these sales by obtaining a copy of the purchaser's annual resale certificate or using the Florida Department of Revenue's online Certificate Verification system. Or, you can call 877-357-3725 toll-free and select Communications Services Tax.
• When a selling dealer obtains a signed resale certificate, additional sales during the year to the same purchaser do not require a new certificate. If the purchaser buys on account on a continual basis, the selling dealer needs to obtain a certificate valid at the time of the initial purchase, but will not need to obtain a new certificate each year.
• If the purchaser knows their Communications Services Tax certificate or business partner number, the selling dealer can obtain a Transaction Resale Authorization Number online at the time of sale. Or, you can call 877-357-3725 toll-free and select Communications Services Tax. The Transaction Resale Authorization Number received by phone or online is valid for that transaction only. If a purchaser has already provided a copy of their resale certificate, selling dealers can obtain a unique Vendor Resale Authorization Number by using the online certificate verification system.
• Dealers may upload a batch file of up to 50,000 accounts and receive a Vendor Authorization Number for each the next day. Vendor Authorization Numbers are valid for sales to each purchaser during the calendar year.

Self-accrual authority may be granted to qualifying entities for one of the following reasons:

• The Department may grant a direct pay permit for interstate communications services when the majority of the communications services used originate outside of Florida and terminate within Florida.
• The Department may grant a direct pay permit for tax due upon determination when the taxable status of sales of communications services will only be known upon use.

To apply for a direct pay permit, you must complete a Florida Business Tax Application (Form DR-1 ) and an Application for Self-Accrual Authority/Direct Pay Permit - Communications Services Tax (Form DR-700030 ).

A dealer using one or more of the following qualifying methods to ensure proper address-to-jurisdiction assignment for purposes of collecting local communications services tax will be granted an allowance of .75% of the total tax due.

• Using the Florida Department of Revenue's address/jurisdiction database to verify the accurate assignment of customer addresses to tax jurisdictions.
• Using a database developed by the dealer that has been certified by the Department to verify the accurate assignment of customer addresses to tax jurisdictions.
• Using a Department-certified database supplied by a vendor to verify the accurate assignment of customer addresses to tax jurisdictions.
• Using ZIP+4 and a methodology to match an address to its taxing jurisdiction when ZIP codes cross jurisdictional lines.

If a qualifying method is not used to ensure proper address-to-jurisdiction assignment, a collection allowance of .25% will be granted.

Direct-to-home satellite service providers receive the .75% collection allowance.

The Florida Department of Revenue's Address/Jurisdiction Database identifies the local taxing jurisdiction for addresses in Florida. The database is based on information provided by local taxing jurisdictions and is updated every six months.

Dealer or vendor databases can be certified for their accuracy of assignment of street addresses to the proper jurisdiction. Dealers or database vendors can request database certification by filing an Application for Certification of Communications Services Database (Form DR-700012 ).

List of certified database vendors:

• Avalara (Formerly known as Billsoft, Inc.)
• CoreLogic (Formerly known as Proxix Solutions, Inc.)
• Precisely Software, Inc. – Geo Tax Premium
• Vertex, Inc.

Businesses and dealers who purchase taxable communications services from a seller that does not collect tax must report and pay use tax on their Florida Communications Services Tax Return (Form DR-700016 ).

Consumers who purchase taxable communications services from a seller that does not collect tax must report and pay use tax using the Communications Services Use Tax Return (Form DR-700019 ).

Communications services providers must register to report and pay communications services tax. You can register using the online registration system, or submit a paper Florida Business Tax Application (Form DR-1 ).

When to Notify the Department

You must notify the Florida Department of Revenue, if you:

• Change your business name;
• Change your mailing address;
• Change your location address; or
• Close or sell your business.

The quickest way to notify the Department of these changes is to update your account online.

When to Submit a New Tax Application

You must submit a new registration using the online registration system or complete a paper Florida Business Tax Application (Form DR-1 ), if you:

• Change your legal entity; or
• Change the ownership of your business.

Communications services tax is reported using a Florida Communications Services Tax Return (Form DR-700016 ). You can file and pay communications services tax electronically using the Department's free and secure eFile and Pay webpage.

Returns and payments are due on the 1st and late after the 20th day of the month following each reporting period. If the 20th falls on a Saturday, Sunday, or state or federal holiday, returns are timely if filed electronically, postmarked, or hand-delivered to the Department on the first business day following the 20th. A return must be filed for each reporting period, even if no tax is due.

Taxpayers who paid $5,000 or more in communications services tax during the most recent state fiscal year (July 1 - June 30) are required to file and pay electronically during the next calendar year.

When you electronically pay only or you electronically file and pay at the same time, you must initiate your electronic payment and receive a confirmation number no later than 5:00 p.m.. ET, on the business day prior to the 20th to avoid penalty and interest. For a list of the electronic payment deadlines, visit the Department's Forms and Publications webpage and select the current year Florida eServices Calendar of Electronic Payment Deadlines (Form DR-659) under the eServices section.

If you file your return or pay tax late, a penalty of 10% of any unpaid tax for each 30 days or fraction thereof, not to exceed a total penalty of 50% of unpaid tax, is charged. A floating rate of interest applies to underpayments and late payments of tax. Interest rates can be found on the Department's Tax and Interest Rates webpage.