31 January 2025 Upcoming business tax filing deadlines in San Francisco and Los Angeles Commonly overlooked California local business tax filing deadlines are quickly approaching in San Francisco, Los Angeles, and other localities throughout the state. As the federal and state tax filing season approaches, taxpayers should be aware of the below information on reporting and paying local business taxes. 2024 San Francisco Annual Business Tax (SF ABT) returns are due on or before Friday, February 28, 2025. The SF ABT return includes reporting and payment of Gross Receipts or Administrative Office Taxes, Homelessness or Homelessness Administrative Office Taxes, Commercial Rents Taxes and Overpaid Executive Gross Receipts Taxes. Taxpayers can request a 60-day filing extension by submitting a written request and paying at least 90% of taxes due by the filing deadline. SF ABT returns and tax payments must be filed electronically using the city's 2024 ABT Payment Portal. Additional information regarding the SF ABT is available on the city's website. In addition to filing SF ABT returns, taxpayers must also file or renew their business registration and submit payment of the city's Business Registrations Tax by May 31, 2025. Prop M, which was passed by city voters in November and became effective January 1, 2025, made significant changes to San Francisco business taxes, including the Gross Receipts tax, Homelessness Gross Receipts tax, Overpaid Executive Gross Receipts tax, and Administrative Office Tax. Changes made by Prop M are likely to impact many large taxpayers, with the top tax rate more than tripling (from 1.008% to 3.716%) for the Gross Receipts Tax and more than doubling (from 0.69% to 1.65%) for the Homelessness Gross Receipts Tax. (A chart of the new effective tax rates can be found here). San Francisco also adjusted the apportionment of the Gross Receipts Tax to more heavily weigh the sales factor for most industries, as opposed to a more even split between the sales factor and the payroll factor. Finally, the threshold for application of the Homelessness Gross Receipts tax has also been cut in half from $50 million to $25 million, thereby imposing the tax on more businesses in San Francisco. For a more in-depth discussion of Prop M, see Tax Alert 2024-1825. The deadline for filing tax year 2025 Los Angeles Business Tax (LABT) renewals1 is Friday, February 28, 2025. The city provides copies of forms for download and completion in writing and allows filing of renewal forms and payment of taxes through its electronic filing system. Both the downloadable forms and the electronic filing system are accessible through the city's website. To be considered timely filed, a taxpayer's forms must be postmarked or electronically submitted no later than 11:59 PM PST on Friday, February 28, 2025. Taxpayers can apply for a maximum filing extension of 45 days by submitting a written request, accompanied by payment of at least 90% of the total tax due, by the February 28, 2025, filing deadline. The Los Angeles Office of Finance recently announced an extension of time to file for certain businesses impacted by the California wildfires. The relief will be automatically granted to business locations within zip codes 90402, 90272 and 90049 (note this relief does not include the Downtown Los Angeles area). Taxpayers with businesses located outside the previously mentioned areas, but who experienced a business interruption as a direct result of the fires, must make a written request for an extension, including reasonable proof of interruption, before February 28, 2025. The written request must be entered into a Google Doc found on the LA homepage. Additional information about the Los Angeles Business Tax renewal process is available on the city's website. One-year statute of limitation period for filing refund claims for City of San Francisco and Los Angeles business taxes closing soon Companies engaged in business in San Francisco and Los Angeles should consider reviewing their SF ABT filings and LABT renewals (assuming returns and renewals were timely filed/paid) before the expiration of each city's one-year statute of limitation for filing refund claims on Friday, February 28, 2025 for tax year 2024 (for Los Angeles this is the 2025 tax year, based on 2024 activity). SF ABT filings include reporting and payment of the Gross Receipts Tax or Administrative Office Tax, the Homelessness Gross Receipts Tax or the Homelessness Administrative Office Tax, the Commercial Rents Tax, and the Overpaid Executive Tax. In Los Angeles, the LABT filing primarily includes reporting and payment of Gross Receipts Tax based on specific classification(s). For Los Angeles, calendar year 2024 relates to the 2025 Business Tax Renewal. Nearly every California municipality imposes some form of local business license tax or fees, but the types of levies, tax bases, and filing requirements and deadlines vary widely by locality. For example, the City of Santa Monica, like its neighbor Los Angeles, imposes a gross receipts tax on businesses operating within the city, but returns and payments aren't due until August 31 of each year.
Document ID: 2025-0372 | ||||||