Office Building Parking Notice

Parking Tax Applicability to Office Building Parking in San Francisco

San Francisco's Parking Tax (Article 9 of San Francisco Business and Tax Regulations Code Sections 601 and following) generally applies to the rental of all parking spaces in the City. This is true even when a parking space is furnished with rented office space and rent for the parking space is not separately stated in the rental agreement, if the landlord, its agent, or its contractor continues to monitor or control who may park in that space. The building owner or owner’s agent who receives rent from a building tenant for the occupancy of a parking space controlled by the owner, its agent, or its contractor is an operator who must collect and remit the tax from the parking space occupant to the City.

In these instances where the rent for the parking space is not separately stated in the rental agreement the Tax Collector will presume the rent is the market rate of parking at the location. If market rates are not available, the Tax Collector will presume the parking rate is $370/month ($296 parking rent and $74 parking tax) for parking stations in the Downtown Area (see below) and $250/month ($200 parking rent and $50 parking tax) for stations located in other areas of the City. These rates are equal to the lowest rates charged by City-owned garages in each of the identified areas.

These instructions are not intended to alter the collection of parking tax from customers by any parking lot operators that operate parking stations in office buildings.  The parking tax will continue to be collected and remitted by the parking lot operator to the City.

How to Determine “Downtown Area”:

The Downtown Area is coterminous with the San Francisco General Plan definition of downtown, and is comprised of all properties located within the C-3 zone (specifically, C-3-O, C-3-R, C-3-G, and C-3-S). You can determine whether your property is located within the Downtown Area by using the City's website. To do so, visit the City's website at http://propertymap.sfplanning.org, input your address, and select “Zoning Information” to locate your zoning district.

 Examples:

Building owner A rents a 5,000 sq. ft. office in the Downtown Area to Tenant B.  B pays rent in the amount of $20,000 a month to A. The office space lease includes 10 parking spaces controlled by an attendant employed by A; however, the lease does not specify the portion of the total rent allocable to the parking spaces included in the lease. There is no public parking provided in the garage where B’s parking spaces are located. The Tax Collector will presume each of these 10 parking spaces are rented by B from A for $370 per month ($296 parking rent and $74 parking tax). A total of $2,960 per month is therefore allocable to taxable parking rent ($296 x 10). The tax payable by A to the City for such parking rent is $740 per month (25% x $2,960).

Building owner A rents a 5,000 sq. ft. office in the Downtown Area to Tenant B. B pays rent in the amount of $20,000 a month to A. The office space lease includes 10 parking spaces that includes signage posted by A restricting access to the 10 parking spaces to B; however, the lease does not specify the portion of the total rent allocable to the parking spaces included in the lease. Public parking is available for $400 per month (including parking tax) in the garage where B’s parking spaces are located.  The Tax Collector will presume each of these 10 parking spaces are rented by B from A for $400 per month ($320 parking rent and $80 parking tax). A total of $3,200 per month is therefore allocable to taxable parking rent ($320 x 10). The tax payable by A to the City for such parking rent is $800 per month (25% x $3,200).