Reduced Commercial Rent Sales Tax as of January 1, 2018

The State of Florida has issued a reduced sales tax rate on commercial rent beginning January 1, 2018. This reduction takes the commercial rent sales tax from 6% to 5.8% at the state level.

This new law will cause landlords to amend existing contracts/leases by January 1, 2018 in which those contracts/leases indicate a 6% commercial rent sales tax. However, if contracts/leases do not indicate the exact percentage rate, and only state that tenants will be charged applicable sales tax, an amendment may not be needed.

There are rules in place that prevent delaying rent payments to take advantage of the new lower rate. The tax rate applicable to a rent payment is based on the date the property is occupied, not when payment is due and/or paid.

Should you have any questions regarding this, or other tax matters, please feel free to contact us at 239-433-5554.