Annual Business Tax Returns (2020)

The San Francisco Annual Business Tax Returns include the Gross Receipts Tax, Payroll Expense Tax, Administrative Office TaxCommercial Rents Tax and Homelessness Gross Receipts TaxTo avoid late penalties/fees, the returns must be submitted and paid on or before April 30, 2021

                                                 File Annual Business Tax Returns (2020)

                                                                              Instructions

Watch our instructional videos on filing your 2020 Annual Business Tax Returns. The Returns are optimized for current versions of Chrome, Firefox, and Safari. Please check and/or update your version before filing. 

Additional Information

Persons other than lessors of residential real estate must file applicable Annual Business Tax Returns if they were engaged in business in San Francisco in 2020 (as defined in Code section 6.2-12, qualified by Code sections 952.3 (f) and (g), and are not otherwise exempt under Code sections 906 or 9542105, and 2805, unless all of the following are true:

  • Their taxable payroll expense in the City, computed without regard to the small business tax exemption in Code section 905-A, is less than or equal to $320,000; and
  • Their combined taxable gross receipts in the City, computed without regard to the small business exemption in Code section 954.1, is less than or equal to $1,200,000.

You ARE ENCOURAGED to file if your 2020 payroll expense was less than $320,000 or gross receipts was less than $1,200,000 AND you made estimated (quarterly) payments toward 2020 San Francisco taxes, as you may be eligible for a refund. If eligible based on your filing, your refund will be processed automatically.  

Exclusions & Tax Credits

Persons taking the Biotechnology Exclusion, the Clean Technology Business Exclusion, the Enterprise Zone Tax Credit, or the Commercial Rents Tax Credit for Child Care Facilities must file a Return regardless of their payroll expense or gross receipts. 

Administrative Office Tax

Persons subject to the Administrative Office Tax must file a Return regardless of their gross receipts or payroll expense.

Due to the extensive features offered in the online filing, taxpayers are encouraged to use the online form if they are eligible to do so.

Returns are due by April 30, 2021 unless you have received an extension to file by June 29, 2021.  Payments are due by April 30, 2021, regardless of any Return filing extensions.  Failure to meet these deadlines will result in penalties, interest, and fees.

Government grants, including those provided via the Payroll Protection Program, are not considered to be ‘gross receipts’ for purposes of the City’s Gross Receipts Tax.

Gross Receipts rates vary depending on a business’s gross receipts and business activity. Taxpayers deriving gross receipts from business activities both within and outside San Francisco must generally allocate and/or apportion gross receipts to San Francisco using rules set forth in Business and Tax Regulations Code Sections 956.1 and 956.2. 

This table indicates the tax rate and applicable apportionment and/or allocation methodology for each business activity. The Code is based on the 2012 NAICS classifications. For more information on the 2012 NAICS codes, go to www.census.gov/eos/www/naics.

Use your San Francisco Business Activity, our Allocation and/or Apportionment Worksheets and the SF Gross Receipts Tax Computation Worksheet to determine your San Francisco Gross Receipts Tax obligation.

Business Activity0-$1m $1-$2.5m $2.5-$25m$25m +  Calculation Method
Retail Trade; Wholesale Trade; and Certain Services0.075%  0.100%  0.135%0.160% Apportionment for Retail Trade and Wholesale Trade is 50% Sale Location and 50% Payroll Expense (Section 953.1(e))     Apportionment for Certain Services is Payroll Expense (Section 953.1(f))
Manufacturing; Transportation and Warehousing; Information; Bio-Technology; Clean Technology; and Food Services0.125%  0.205%  0.370%0.475%Apportionment for this section is 50% Real, Personal, Tangible and Intangible Property, and 50% Payroll Expense (Section 953.2(g))
Accommodations; Utilities; and Arts Entertainment and Recreation0.300%  0.325%  0.325%0.400%Apportionment for Accommodations is receipts derived from or related to properties located or used in the City (Section 953.3(e)) Apportionment for Utilities is 50% Real, Personal, Tangible and Intangible Property and 50% Payroll Expense (Section 953.3(f)) Apportionment for Arts, Entertainment and Recreation is Payroll Expense (Section 953.3(g))
Private Education and Health Services; Administrative and Support Services; and Miscellaneous Business Activities0.525%  0.550%  0.600%0.650%Apportionment for this Section is Payroll Expense (Section 953.4(d))
Construction0.300%  0.350%  0.400%0.450%Apportionment for this Section is 50% Real, Personal, Tangible and Intangible Property and 50% Payroll Expense (Section 953.5(c)) In addition, Real, Personal, Tangible and Intangible Property shall be reduced by the amounts paid to a subcontractor in the City. Person must submit itemized deduction list in order to claim. (Section 953.5(c))
Financial Services; Insurance; and Professional, Scientific and Technical Services0.400%  0.460%  0.510%0.560%Apportionment for this Section is Payroll Expense (Section 953.6(e))
Real Estate and Rental and Leasing Services0.285%  0.285%  0.300%0.300%Apportionment for this Section is receipts derived or related to properties located or used in the City. (Section 953.7 (c))

You are required to file a return within 15 days of closing your business. Review our instructions for additional information. 

Close your business

 

For purposes of this Return, a lessor of residential real estate is treated as a separate person (with a separate Business Account Number) with respect to each individual building in which it leases residential real estate units, and must file a separate Return for each individual building and for its other business activities combined.  A lessor of residential real estate must therefore allocate its gross receipts and payroll expense to each individual building in which it leases residential real estate units and to its other business activities combined.  “Residential real estate” means real property where the primary use of or right to use the property is for the purpose of dwelling, sleeping or lodging other than as part of the business activity of accommodations.

Lessors of residential real estate in San Francisco must file a Return for each building in San Francisco under a separate Business Account Number to correctly report their tax liability.  If the lessor of residential real estate is not claiming a tax credit, exclusion, or limit they may file using the simplified Lessor Form. 

If claiming a tax credit, exclusion, or limit, lessors of residential real estate that engage in any business other than leasing residential real estate (e.g., leasing commercial real estate, retailing, etc.) must file the Returns under a separate Business Account Number for the portion of their business that is not leasing residential real estate.

If they are not otherwise exempt under Code sections 906 and 954 unless they lease fewer than 4 units in that individual building, lessors of residential real estate in San Francisco must file a Gross Receipts Tax Return for each building in San Francisco under a separate Business Account Number to correctly report their tax liability.  Lessors must file a Payroll Expense Tax Return for each building unless their taxable payroll expense in the City attributable to that building, computed without regard to the small business tax exemption in Code section 905-A, is less than or equal to $320,000.

Example 1: Lessor of Residential Real Estate Registration and Filing Requirements

Assume Corporation A leases 10 residential units and 5 commercial units in Building A, leases 3 residential units and 4 commercial units in Building B, and generates $3,000,000 of gross receipts and $400,000 of payroll expense from these activities. 

Based on rules analogous to those in Code section 904 or another appropriate cost accounting methodology, Corporation A allocates $250,000 of its payroll expense to the lease of its 9 commercial units, $100,000 to the lease of its 10 residential units in Building A, and $50,000 to the lease of its 3 residential units in Building B. 

Based on its books and records, Corporation A determines that $2,000,000 of its gross receipts are from the lease of the 9 commercial units, $750,000 are from the lease of the 10 residential units in Building A, and $250,000 are from the lease of the 3 residential units in Building B. 

Corporation A would have to file a Gross Receipts Tax Return reflecting the $2,000,000 gross receipts from the 9 commercial units because its gross receipts were not less than or equal to $1,170,000, but it would not have to file a Payroll Expense Tax Return because its payroll expense allocated to the commercial units was less than or equal to $320,000. 

Corporation A would also have to register as a separate person and file a Gross Receipts Tax Return reflecting the $750,000 gross receipts from the 10 residential units in Building A because Corporation A leases more than 3 residential units in Building A.  But Corporation A would not need to file a Payroll Expense Tax Return with respect to the residential units in Building A because its payroll expense allocated to the residential units in that building was less than or equal to $320,000.  Corporation A would also not need to file a Gross Receipts Tax or Payroll Expense Tax Return for the 3 residential units in Building B because Corporation A leases fewer than 4 residential units in Building B and the $50,000 payroll expense allocated to the residential units in Building B is less than or equal to $320,000. Corporation A would have to register as a separate person for the 3 residential units in Building B because it has payroll expense allocated to that building.

 

Form will be available soon!

 

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Video Instructions

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