This page summarizes the application of San Francisco’s Administative Office Tax for tax years beginning in 2025 following the adoption of Proposition M. View pre-Proposition M rules for 2024 and prior years here.
The Administrative Office Tax (AOT) component of the Gross Receipts Tax is imposed on persons engaging in business within the City as an administrative office. For tax year 2025, the tax is calculated as 1.47% of the San Francisco payroll expense of the business. Businesses generally are engaging in business within the City as an administrative office if they have more than 1,000 U.S. employees, have over $1 billion in combined gross receipts reported on U.S. federal income tax returns, and are primarily engaged in providing administrative or management services exclusively to the business and its related entities.
Beginning in 2025, whether a business is engaging in business within the City as an administrative office is also based on whether the qualifying conditions have been met over multiple years. See Determining Administrative Office Status below for more information.
The AOT is filed as part of the Annual Business Registration and Tax Form.
There is an additional 1.5% Homelessness Gross Receipts Tax on businesses subject to the Administrative Office Tax, for a combined rate of 2.97%.
Businesses will also pay an additional Overpaid Executive Administrative Office Tax if the Executive Pay Ratio for the tax year exceeds 100:1. See rates below.
Additional Overpaid Executive Administrative Office Tax Rates
| Executive Pay Ratio | 2025 & 2026 | 2027 | 2028 |
| Greater than 100:1 but less than or equal to 200:1 | 0.080% | 0.083% | 0.086% |
| Greater than 200:1 but less than or equal to 300:1 | 0.160% | 0.166% | 0.171% |
| Greater than 300:1 but less than or equal to 400:1 | 0.240% | 0.250% | 0.257% |
| Greater than 400:1 but less than or equal to 500:1 | 0.320% | 0.333% | 0.343% |
| Greater than 500:1 but less than or equal to 600:1 | 0.400% | 0.416% | 0.428% |
| Greater than 600:1 | 0.480% | 0.499% | 0.514% |
A business is considered to be engaging in business within San Francisco as an administrative office if both of the following apply:
1. The qualifying conditions are met.
A business must meet all of the following conditions:
- Over 50% of the total combined San Francisco payroll expense of that person and its related entities for the tax year was associated with providing administrative or management services exclusively to that person or its related entities;
- The person and its related entities had more than 1,000 U.S. employees as of the last day of the tax year; and
- The person and its related entities had over $1 billion in combined gross receipts reported (or that will be reported) on United States federal income tax return(s) for the person or combined group’s most recently completed federal income tax year.
2. The conditions have been met or not met over time.
Classification as an administrative office also depends on whether these conditions have been satisfied during the current and two immediately preceding tax years:
- A person or combined group remains classified as an administrative office until it has failed to satisfy at least one of the above conditions for the current and two immediately preceding tax years; and
- A person or combined group becomes classified as an administrative office once it has satisfied all three of the above conditions for the current and two immediately preceding tax years.
See San Francisco Business and Tax Regulations Code Section § 953.8 for more information.
Administrative or management services comprises internal support services provided on an enterprise-wide basis, such as executive office oversight, company business strategy, recordkeeping, risk management, personnel administration, legal, accounting, market research and analysis, and training services; it does not include sales personnel or personnel actively engaged in marketing, research and development, direct customer service, and product support services.
In an audit, the Tax Collector would request documents to support the entity’s classification of employees. This may include reviewing a cost center analysis and the job functions of individual employees, among other things.
Estimated business tax payments are due April 30th, July 31st and October 31st. Learn more about quarterly estimated payments.
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