What code do I use for my local tax?
Sales of Items Originating in Washington State
- Use the location code & rate for the place where the customer picks up the items.
- If you shipped the item(s) from your business or from a warehouse, use that location code.
Example: A customer from Gig Harbor orders goods from a store located within the city limits of Tacoma. It makes no difference whether the customer picks up the goods, or the Tacoma store makes the delivery. The sale occurs at the Tacoma store so use the location code and rate for Tacoma.
For Sales of Items Shipped to a Customer in Washington From Out-of-State
- If an office, representative, or agent in Washington participates in the sale, use that location code.
- If no office, representative, or agent in Washington exists or participates in the sale, use the location you shipped the item(s) to.
Example: A customer from Olympia orders goods from a business in Los Angeles . The seller has a representative in Federal Way who took the order. Use the location code and tax rate for Federal Way.
Example: A customer from Olympia orders goods from a Minneapolis company that has no office or people in Washington. The location code and tax rate for Olympia apply.
Sales of Retail Services, Installation, and Construction
Businesses performing retail services or selling products requiring significant installation must use the location code where the service or installation takes place.
Example: A Bellevue store sells carpet to a Redmond customer and installs the carpet in the customer's Redmond home. Collect sales tax at the Redmond rate and use that code.
(If the Bellevue store merely delivers the carpet without installation, the sale is subject to tax at the Bellevue rate. See prior example for Sales of items originating in Washington State)
Lease or Rental of Tangible Personal Property
For a short-term lease, use the seller's (lessor's) store location. Short-term leases are generally for less than 30 days and do not require periodic payments.
Example: A Spokane business rents a rototiller to a customer in Airway Heights for two days. The business will collect and code the local tax to Spokane.
For long-term leases, use the customer's (lessee's) location. Long-term leases are generally 30 days or more and require periodic payments.
Example: A person in Yakima enters into a 36-month vehicle lease with a Seattle leasing company. The Seattle Company will collect the applicable rate for Yakima.
If you are unsure which local sales and use tax rate to charge, or which location code to use, you can access the Department's Tax Rate Lookup Tool (GIS) or call 1-800-647-7706.
Reporting Local Sales and Use Tax Rate Changes
(WAC 458-20-199; -235)
Occasionally the tax rate changes or, due to incorporation, an area changes their four-digit location codes in the middle of a reporting period. If changes take place, the income before and after the change must be split on the Excise Tax Return between the old rate and the new rate, or the old location code and the new location code.
Example: The city of Bellingham increased its tax rate effective April 1, 2005 . For sales taking place in Bellingham before April 1, the local tax rate was .017. Sales taking place on or after April 1 are taxed at .018.
Example: The city of Spokane Valley incorporated as of April 1, 2003. For sales taking place before April 1, the local tax is coded to 3200. Sales taking place on or after April 1 are coded to the new location code of 3213.
If you have made a mistake on a past return, you must file an amended tax return.
<< Previous | Table of Contents | Next >>