California Tire Fee Guide

Helping your business succeed is important to the California Department of Tax and Fee Administration (CDTFA). The taxes or fees you collect and pay to the state help fund state and local services and programs that are important to you and your community.

This guide will help you better understand the California Tire Fee and the obligations of tire retailers and purchasers in California.

California Tire Fee

The tire fee is imposed on California consumers for each new tire purchased. Generally, the retailer will collect the tire fee from the customer at the time of the sale. CDTFA administers the California Tire Fee program in cooperation with the Department of Resources Recycling and Recovery (CalRecycle) and the California Air Resources Board (CARB).

How the Revenue is Used

The funds are used to award grants, loans, and subsidies to businesses or other entities that promote activities or develop technologies for tire recycling. The funds are also used by the CARB for air pollution control and prevention.

How to Use This Guide

The Getting Started section provides key resources related to registration, filing returns, making payments, account maintenance, and other important information you need.

The Industry Topics section contains specific topics important to the California Tire Fee.

The Resources section provides links to helpful information, including law and regulation information, publications, special notices, and access to assistance from our Customer Service Representatives.

If You Need Help

If at any time you need assistance with topics included in this guide or have other related questions, please contact us by telephone or email for assistance. Contact information and hours of operation are available in the Resources section of this guide.

If you have suggestions for improving this guide, please contact us by email.

The California Tire Fee is assessed on the retail purchase of new tires intended for use with, but sold separately from, on-road or off-road motor vehicles, trailers, motorized equipment, construction equipment, or farm equipment. The fee also applies to new tires (including the spare) sold with the retail purchase of new or used motor vehicles, trailers, construction equipment, or farm equipment.

See Industry Topics tab for a more detailed list of tires that are or are not subject to the tire fee.

Online registration is an easy and convenient way to register for a California Tire Fee account. Register online with us for a Tire Fee account by selecting Register a New Business Activity.

Who is required to register?

You must register with the California Department of Tax and Fee Administration (CDTFA), collect the tire fee, file a return, and pay the fee to the CDTFA if you are:

  • a California retailer that sells new tires, including new tires on new or used motor vehicles, farm equipment, construction equipment, or trailers drawn upon a highway or road
  • a California retailer (lessor) that leases/rents new or used motor vehicles, farm equipment, or construction equipment that include new tires,
  • a purchaser (consumer) who purchases new tires for personal or business use, but does not pay the tire fee at the time of purchase, including:
    • a purchaser (consumer) that purchases a new tire from an out-of-state seller that does not charge the tire fee.
    • a retailer who becomes a purchaser (consumer) by removing new tires from inventory for purposes other than retail sale or resale or by renting, for periods of four months or less (for example, short-term car rental companies), for use with motor vehicles, trailers, farm equipment, or construction equipment on which new tires were mounted (including the spare).

Visit our Tax Rates - Special Taxes and Fees page to view current and historical rates for the California Tire Fee.

File your return online - CDTFA's online filing service is easy, fast, and free.

You may file your CDTFA-501-TF, California Tire Fee Return, and pay the fee online. The tire fee return and payment are due on or before the 15th day of the month following each reporting period. For example, if your reporting period is for the first quarter (January thru March), the return and fee payment is due on April 15th. The CDTFA-501-TF is due either on a quarterly or yearly filing basis. Your filing frequency is determined at the time you register.

You are required to file a return even if you did not have any reportable activity during the reporting period.

Filing a late return and/or late payment may result in a late penalty and/or interest assessment. See Penalty and Interest topic in this section.

Payment

You may file and pay your tire fees online. Visit our website to make a payment and learn about our various payment options.

If your average monthly fee payment is $20,000 or more, you are required to pay by Electronic Funds Transfer (EFT). CDTFA will notify you in writing if you are required to pay your fees electronically.

Payments must be submitted by the due date to be considered timely. For an EFT payment to be timely, it must be initiated on or before the filing due date and funds must settle into the CDTFA's bank account on or before the banking day following the due date. Please note, some EFT payments made on the return's due date may need to be initiated before 3:00 p.m. Pacific time to be received timely. For more information regarding EFT payments, please see EFT FAQs.

The penalty for filing a late return and/or late fee payment is ten percent of the fee amount due for the period. Interest also applies to late fee payments.

You may log into your account to submit an online request for an extension to file a return or relief from penalty (including interest due to a disaster).

Login with your username and password to update your account information such as changes to your business ownership, email address, mailing address, location address, and phone or fax number. It is important to notify us so we can update our records to ensure you receive information and email reminders to electronically file timely. If you are unable to login to access your account you may use our CDTFA-345-SP, Notice of Business Change Special Taxes and Fees Accounts, form and mail it to the address provided.

California Tire Fee

The California Tire Fee is imposed on the consumer upon the purchase of a new tire, and collected by the retailer at the time of the sale. The retailer then remits the tire fee to the CDTFA.

The tire fee charged to a customer must be separately stated on the invoice or receipt provided to the customer. Retailers may retain one and half percent (1.5%) of the tire fee collected as reimbursement for any costs associated with the collection of the fee.

Consumers, who purchase new tires through an internet transaction from an out-of-state seller for delivery in California without paying the tire fee, shall pay the tire fee directly to the CDTFA.

Tires Subject to the Fee

New solid or pneumatic (a tire inflated or capable of inflation, with compressed air) tires intended for use with, but sold separately from:

  • On-road or off-road motor vehicles;
  • Motorized equipment (e.g., lawn mower, golf cart, go-cart, etc.)
  • Construction equipment; or
  • Farm equipment

New tires (including the spare) included with the purchase of:

  • New or used motor vehicles;
  • New or used trailers drawn upon a highway or road;
  • New or used construction equipment (e.g., tractor, backhoe, bulldozer, loader, etc.); or
  • New or used farm equipment (e.g., combine harvester, baler, cultivator, picker, etc.)

Note: A new tire does not include retreaded, reused, or recycled tires.

Tires Not Subject to the Fee

  • Any self-propelled wheelchair;
  • Any motorized tricycle or motorized quadricycle designed for a person with a physical disability, as defined in California Vehicle Code section 407; and
  • Any vehicle that is similar to a motorized tricycle or motorized quadricycle and is designed to be operated by a person who, by reason of that person's physical disability, is otherwise unable to move about as a pedestrian.

If you are in the business of leasing/renting new or used motor vehicles, trailers, construction equipment, or farm equipment and you purchase the vehicle/equipment on which new tires are mounted without paying the tire fee, you are responsible for paying and reporting the tire fee to the CDTFA on those transactions. You are required to register for a tire fee account and report the tire fees owed.

If your customer decides to purchase the vehicle, construction equipment, or farm equipment at the end of the lease agreement (lease buyout), you are required to collect the fee from your customer on any new tires you mount on the vehicle or equipment at the time of the sale. If no new tires are mounted on the vehicle or equipment at the time of sale, or if used tires are mounted on the vehicle or equipment at the time of the sale, you should not charge your customer the fee.

If you are required to have a California seller's permit or Certificate of Registration – Use Tax, you must register for a tire fee account and collect the tire fee when you sell tires to California retail customers. The CDTFA's online registration system will guide you through the process. See our online guide, Use Tax Collection Requirements Based on Sales into CA Due to the Wayfair Decision, for more information on whether you may be required to register for sales and use tax purposes.

If you are not required to register for a tire fee account, you may voluntarily register to collect and pay the tire fee as a courtesy to your California customers. Upon collecting the tire fee, you must provide the customer with an invoice or similar document that lists the tire fee as a separate charge. A copy of the invoice or similar document should be retained by both the seller and purchaser.

If the out-of-state seller does not have a tire fee account, the California purchaser must pay the tire fee directly to the CDTFA.

Defective Tires Returned or Manufacturers Recall

If the customer is not charged for new tires that are replacing defective tires, then the customer does not owe the tire fee on the replacement tires. Retailers should make sure that their records and invoices properly reflect these transactions as replacements of defective tires. However, if the customer has to pay the retailer any amount for the replacement tires, the customer owes the tire fee and the retailer must collect the tire fee from the customer.

If a manufacturer recalls the tires and instructs the retailer to provide replacement tires to customers at no cost and the manufacturer pays, reimburses, or gives credit to the retailer for the replacement tires, the manufacturer owes the tire fee on the replacement tires. The manufacturer is deemed to be the purchaser of the replacement tires, and the retailer of the tire must collect the tire fee from the manufacturer.

Tires Replaced Under Warranty

If the customer has to pay the retailer any amount for the replacement tires, then the customer owes the tire fee and the retailer must collect the tire fee from the customer. If the retailer does not charge the customer for the replacement tires, then the retailer must pay the tire fee owed directly to the CDTFA.

The tire fee does not apply to the following sales:

  • Sales for resale.
  • Sales to American Indians occurring on Indian reservations.
  • Sales of new tires that the retailer ships directly to a location outside California when the transaction is not subject to California sales or use tax; however, the tire fee will apply if the buyer takes possession of the new tires in California.

In addition, tires not subject to the tire fee include tires intended for use or sold with:

  • Any self-propelled wheelchair;
  • Any motorized tricycle or motorized quadricycle designed for a person with a physical disability as defined in California Vehicle Code section 407; and
  • Any vehicle that is similar to a motorized tricycle or motorized quadricycle and is designed to be operated by a person who, by reason of that person's physical disability, is otherwise unable to move about as a pedestrian.

PLEASE NOTE: Sales to the United States Government are not exempt from the California Tire Fee.

Laws and Regulations

Publications

Special Notices

Related Web Sites

Other Helpful Resources

  • Contact Us – A listing of CDTFA contacts for your questions and concerns.
  • Sign Up for CDTFA Updates – Subscribe to our email lists and receive the latest news, newsletters, tax and fee updates, public meeting agendas, and other announcements.
  • Videos and How-To Guides – These resources will help you avoid common mistakes, file your tax returns online, and more.
  • Online Services – Learn about the online services CDTFA offers.
  • Office Locations and Addresses – A comprehensive listing of all CDTFA offices and contact information.
  • Get It In Writing! – Tax and fee laws can be complex, and you are encouraged to put your tax questions in writing. You may send your request to: Special Taxes and Fees, MIC:31, California Department of Tax and Fee Administration, P.O. Box 942879, Sacramento, CA 94279-0031.
  • Taxpayers' Rights Advocate (TRA) – The TRA Office helps taxpayers when they are unable to resolve a matter through normal channels, such as speaking to a supervisor, or when there are apparent rights violations.
  • GO-Biz – The Governor's Office of Business and Economic Development offers extensive information on state, local, and federal permit requirements. For a listing of their assistance centers, visit their website.
  • CalGold – Provides help with permit and licensing requirements on other state, federal, and local authorities. For example, you may need to register with the Franchise Tax Board or the Employment Development Department. You may also want to consult with a tax professional or your local city and county authorities for assistance regarding other agencies' requirements or restrictions.
  • California's Tax Service Center – A one-stop tax help and resource website that guides taxpayers to forms and services they need.