As part of the Covid relief, California is providing Small businesses with an option for interest free deferral of sales/use tax up to $50,000 for businesses with less than $5 million in taxable sales.. Under this relief, qualifying sales and use taxpayers with deferred liabilities up to $50,000 will pay their tax due in 12 equal monthly installments. No interest or penalties will be assessed against the liability.
Besides, If taxpayers choose to use this program to distribute the burden of their May or June prepayments or their July return, CDTFA will work to accommodate those taxpayers.
The above payment plans are in addition to the previous announcement made whereby CDTFA has provided a three-month extension for a tax return or payment to any businesses filing a return for less than $1 million in tax. For such business taxpayers their current California sales and use tax obligation, returns for the 1st quarter 2020 will now be due on July 31, 2020. All businesses will also have an extra 60 days to file claims for refund from CDTFA or to appeal a CDTFA decision to the Office of Tax Appeals.
Businesses who do not fall within these parameters can contact CDTFA who retains administrative flexibility to assist businesses needing relief in the case of disasters.