Industry Topics for Event Planners

The Basics

Sales and Use Taxes in General

In California, retail sales of tangible personal property are taxable unless the law provides a specific exemption or exclusion. The term tangible personal property means an item that can be seen, weighed, measured, felt, or touched. Sales tax is imposed on retailers and generally applies to the retailers' gross receipts from their sales of tangible personal property made within California.

Use tax is a companion to California's sales tax and is due whenever you purchase taxable items without payment of California sales tax from an out-of-state vendor for use in California. You may also owe use tax on items that you remove from your inventory and use in California when you did not pay tax on your purchases of inventory items.

As an event planner, services you perform in connection with your sales of tangible personal property may be subject to tax.

*See Revenue and Taxation Code section 6051.

*See Revenue and Taxation Code section 6201.

Seller's Permit

Most people who sell taxable merchandise or perform taxable labor in California, even temporarily, must register with us for a seller's permit. Registering for a seller's permit is free, although in some cases, a security deposit may be required.

If your business has more than one location that participates in taxable transactions, you generally must register each location with us. You can register with us for a seller's permit or consolidated seller's permit (that is, a permit that includes sub-permits issued for each location) using our Taxpayer Online Service Portal.

Be sure to let us know about any changes to your business, or to your mailing or email address, so we can keep your records updated and inform you of important changes in law, tax rates, or procedures.

You can easily update your account information by logging in to our taxpayer online service portal with a username and password, contacting our Customer Service Center or requesting help at any of our field offices throughout the state. Contact information is also available in the Resources section of this guide.

*See Revenue and Taxation Code section 6066.

Know Your Tax Rates

The current statewide base sales and use tax rate is 7.25 percent. However, the total sales and use tax rates are higher in areas where district taxes are imposed.

District taxes are voter-approved taxes imposed by cities, counties, and other local jurisdictions. District taxes are added to the statewide base rate. If you are a retailer, you are responsible for reporting your retail sales and paying the tax to us at the proper rate. If you make retail sales in California from a business located in a taxing district, you are generally responsible for the district sales tax. You are also responsible for collecting, reporting, and paying the district use tax when making sales for delivery into taxing districts in which you are considered engaged in business in the district.

Generally, you are engaged in business in a district when you meet one of the following conditions:

Notes

  1. On and after April 25, 2019, a retailer is considered engaged in business in every district that imposes a district tax if, in the preceding or current calendar year, their total combined sales of tangible personal property in this state or for delivery in this state exceed $500,000. All retailers meeting this threshold are responsible for collecting and paying any district tax on taxable sales made for delivery in any district that imposes a district tax.

For more information on being engaged in business in a district, please see publication 44, District Taxes (Sales and Use Taxes) or our Local and District Tax Guide for Retailers. Current and historical district tax rates may be found on our California City & County Sales & Use Tax Rates webpage.

You can look up tax rates by city and county or find the full tax rate in your city or county by going to our Find a Sales and Use Tax Rate webpage and entering the address as prompted.

*See Revenue and Taxation Code section 6051.

*See Revenue and Taxation Code section 7261.

*See Revenue and Taxation Code section 7262.

Key Industry Topics

Sales and Use Tax Application to Event Planners

As an event planner, the services you provide for your clients may include creating and conceptualizing unique themes. In addition to consultation and planning services, you may also make all of the necessary arrangements for events, parties, weddings, and meetings.

Your charges and the corresponding tax application are as follows:

Consultation Services and Planning

Mandatory charges for professional planning or coordination of events are taxable if the fees are charged in connection with your sales of tangible personal property.

For example, if the primary purpose of planning an event is preparing and furnishing of food and beverages, fees charged for coordinating the reception are taxable.

*See Regulation 1501.

Minister

Charges for services performed by an ordained minister in connection with a marriage ceremony that do not result in a transfer of tangible personal property do not constitute a sale or lease of tangible personal property, therefore, they are not subject to tax.

*See Revenue and Taxation Code section 6006.

*See Regulation 1501.

Caterers

When You are Considered the Caterer for Your Customer

You are considered a caterer if you serve meals, food, or drinks on the premises of your customer, or on premises supplied by the customer. Tax applies to the entire charge made by caterers for serving meals, food, and drinks.

In addition, charges for food, the use of dishes, silverware, glasses, chairs, or tables used in connection with serving meals, and for the labor of serving the meals, whether performed by the caterer, the caterer's employees or subcontractors, are subject to tax. Tax applies to charges made by caterers for preparing and serving meals and drinks even if the food is not provided by the caterers.

When You Hire a Caterer for Your Customer

When you contract with your customer to provide food catering services for an event and you hire a caterer to provide the food and beverages and catering services, the caterer is making a sale for resale of the food and beverages and catering services to you, for which the caterer may accept a resale certificate. When the caterer invoices you, and in turn, you invoice your customer, you are selling food and beverages and catering services directly to your customer. Tax applies to your charges for the food and beverages and catering services.

*See Regulation 1603.

*See publication 22, Dining and Beverage Industry.

Cakes

Charges for providing a cake are subject to sales tax. Charges for cutting and serving cake are also subject to sales tax.

Bartenders

When You Provide Liquor and Bartenders

When you contract with your customer to provide liquor and bartending services, the entire charge is subject to tax even if the bartending service charge is separately stated.

When You Only Provide Bartending Services

When you contract with your customer to provide bartending services and they provide the liquor, but you charge a fee for corkage fees services, your charges for these services are subject to tax. For example, a corkage fee for opening and serving customer-furnished wine is taxable.

*See Regulation 1603.

*See publication 22, Dining and Beverage Industry.

Tips and Gratuities

Generally, an optional payment designated as a tip, gratuity, or service charge is not subject to tax. However, a mandatory payment designated as a tip, gratuity, or service charge is required to be included in taxable gross receipts, even if the amount is later paid by the retailer to employees.

*See Regulation 1603.

*See publication 115, Tips, Gratuities, and Service Charges.

Accommodations

Accommodations provide convenience for your customers and are relevant to various aspects within event planning, such as providing staff to serve meals, providing performers for entertainment, parking information for guests, or transportation coordination. When accommodation charges relate to your sales of tangible personal property, they are subject to sales tax. Otherwise, they are not.

Accommodations could be related to food and drinks, table seating arrangements, maps and parking information, or coordinating transportation for your clients.

Example 1
Your charge for accommodations of staff who will serve meals is subject to tax for your sale of those meals.

Example 2
Your charge for accommodations of the entertainment staff is not subject to sales tax since the providing of entertainment is not a sale of tangible personal property.

*See Regulation 1501.

Formal Wear (Tuxedos and Gowns)

Charges for leasing formal wear are subject to tax as continuing sales and purchases unless the formal wear is leased in substantially the same form as acquired and you have paid either the sales tax or have timely reported and paid the use tax.

Example: You contract with your customer for the rental of formal wear for a wedding and you own your own rental inventory. The charges for the rental of the formal wear are subject to tax unless the formal wear is rented in substantially the same form as acquired and tax was paid on the purchase price (or tax was paid on the prime lease and then subleased).

*See Regulation 1660.

Florist

Charges for leasing floral arrangements are subject to tax as continuing sales and purchases.

Photographer and Videographer

Generally, tax applies to the sale of photographs sold in the form of tangible personal property for noncommercial use. The sale of related items and services rendered to create or produce the photographs will also be taxable.

However, if the photographs are electronically transferred to the customer and the customer is not provided with photographs in any tangible form, the charges related to the sale are generally not subject to tax.

When you or the photographer provide your customer photographs in a tangible form, such as prints, slides, etc., or as a digital image on a tangible storage medium (for example, DVD, flash drive, CD, etc.), tax generally applies to your entire charge, which may include charges for:

  • The physical product you transfer to your customer;
  • Labor and services involved in producing the photograph; and
  • Reproduction rights associated with the photograph (such as licenses, copyrights, and royalties).

Generally, tax applies to the sale of videos sold in the form of tangible personal property. However, if the videos are electronically transferred to the customer and the customer is not provided with videos in any tangible form, the charges related to the sale are generally not subject to tax.

For more information regarding photographers, please see publication 68, Photographers, Photo Finishers, and Film Processing Laboratories.

*See Regulation 1528.

Musicians and Entertainers

Assuming services for music and entertainment do not result in a transfer of tangible personal property, nor are they used in connection with the service of the food, charges for those services are not subject to tax.

*See Regulation 1501.

Leasing and Rentals of Party Equipment

Charges for leasing equipment rentals are subject to tax as continuing sales and purchases. However, tax does not apply to equipment rentals that are leased in substantially the same form as acquired and you have paid either the sales tax or have timely reported and paid use tax.

If you (event planner) are not considered the agent of your customer when arranging for the equipment rentals, then the equipment rental company is leasing to you, and you may be subleasing to your customer. If you are an agent of your customer when arranging the equipment rentals, the rental company is leasing the equipment directly to your customer. You should obtain a clear agreement establishing an agency relationship with your customer.

Tax does not apply to receipts from your subleases of equipment that are leased in substantially the same form as acquired and you have either paid sales tax reimbursement or reported and paid use tax measured by the purchase price. Also, tax does not apply to subleases of equipment rentals if the tax is paid on rental receipts derived under the prime lease or any other prior sublease. Otherwise, charges for that sublease are subject to tax as continuing sales and purchases.

Please note: If you use equipment rentals in the service of meals, such as napkins, utensils, glasses, and dishes, you are not regarded as leasing to your client. Your charges to the client for the lease of equipment rentals would be included in the measure of tax for the sale of the meals.

*See Regulation 1660.

*See Annotation 515.0001.100.

For more information on when tax applies to leases of tangible personal property, see publication 46, Leasing of Tangible Personal Property.

Set-up and Tear-down Labor

Separately stated charges for services for labor to set up leased property are subject to tax as part of your lease unless those services are optional and occur after the lease has commenced. Separately stated charges for services for labor to tear down or pick up leased property are also subject to tax as part of your lease unless those services are optional.

*See Regulation 1501.

Installation and Fabrication Labor

You contract with your customer to provide flower arrangements and floral decorations for an event. Your charges for labor may be taxable.

Tax applies to any charges for producing, fabricating, or processing tangible personal property, whether the property is furnished by you or the customer. The producing, fabricating, or processing of tangible personal property includes any operation that results in the creation or production of tangible personal property or that is a step in a process or series of operations resulting in the creation or production of tangible personal property. Therefore, when you charge for labor to create or add to a flower arrangement or other decorations, such as decorating a premanufactured arch with flowers, your charges for labor are subject to tax as steps in the making of the final product.

However, your separately stated charges for installation are not subject to tax. Installation labor does not mean deciding where to place the flower arrangements or other decorations, but the physical act of affixing or placing the flower arrangements or other decorations in position. For example, if you sell a wreath or garland, the charges for the wreath or garland (including the fabrication labor) are subject to tax, but a charge for actually hanging the wreath or garland is nontaxable installation labor.

*See Regulation 1501.

*See Regulation 1526.

*See Annotation 240.0008.