Key Takeaways

  • All businesses with nexus in LA must file a tax renewal annually, even if no tax is due.
  • The renewal deadline is typically January 1 through February 28.
  • Penalties accrue monthly for late filings, up to 40% plus interest.
  • Online and mail-in renewals are available; mailed forms must be postmarked by the due date.
  • Small business exemptions are available for gross receipts under $100,000.
  • Businesses should use the appropriate form, like the City of Los Angeles Business Tax Renewal Form 2016, when applicable.
  • Online renewal requires key identifiers like your Business Tax Registration Certificate (BTRC) number and account PIN.

The LA county business tax renewal affects numerous businesses that are required to pay the Los Angeles Business Tax (LABT), a gross receipt tax. Normally, this tax put various business activities in their own designated category with their own tax rates. This tax is location-based and applies to businesses operating within the City of Los Angeles. Business owners must register and acquire a business license for every business location they have in the city.

Nexus and the LABT

Any business that has a nexus with Los Angeles is subject to the LABT. What count as a nexus is thoroughly established, and the definition is broad enough to cover almost all individuals and ventures “engaged in business” in the City of Los Angeles.

A nexus exists if a business meets any of the following criteria:

  • Is stationed at a fixed location in the city.
  • Leases a physical location within the city to conduct business.
  • Stores inventory in the city.
  • Is trying to obtain business clients within the city on a regular basis.
  • Has a continuous flow of work or services in the city.

A nexus is also established if the business owner uses a motor vehicle in the city on when conducting business.

Allocation and Distribution of the LABT

The LABT is determined after an assessment of the gross receipts obtained from business conducted in the city. This is mirrored in the 2017 tax rates for the different tax categories, which range from as little as $1.01 (for wholesalers and retailers) to $4.50 (for professions and occupations). In cases where a business owner runs two or more businesses, they are allowed to choose the single tax classification approach. This gives them the right to calculate their tax using just one category of tax rate if 80 percent or more of their gross receipt falls within that category.

Generally, the statute of limitations for assessment of a business's gross receipts is three years. However, in cases where a considerable understatement of tax has occurred (of at least 25 percent), it gets prolonged to six years or to eight years for taxpayers who haven't filed their taxes at all. In October 2011, a Voluntary Disclosure Program (VDP) became effective. This program reduced the look-back period for non-filers to five years.

When Is the LABT Renewal Due?

Taxpayers should stay updated on the development of the LABT renewal. They should know when the renewal is due. In 2017 for example, the LABT renewal and tax could be paid on January 1, 2017. If taxpayers couldn't file and make the payments on this date, they had until February 28, 2017, to do so. That was also the last day for filing. Failure to make the payments on or before this date was perceived as irresponsible or even criminal, resulting in a delinquency penalty of 5 percent of the tax owed, plus another 5 percent per month and interest for the first three months of delinquency.

Furthermore, the taxpayer was charged with another 20 percent penalty if he/she didn't make the payment for months or longer after the initial deadline. If so, the taxpayer would owe a delinquency penalty of 40 percent of the tax due plus interest.

Filing Options for LABT Renewal

Los Angeles business owners can file their LABT renewal in several ways:

  1. Online Renewal:
    • Visit lacity.gov's finance portal.
    • Use your Business Tax Registration Certificate (BTRC) number and account PIN.
    • Follow on-screen prompts to verify business info, report gross receipts, and apply exemptions or credits.
  2. Mail-in Renewal:
    • Taxpayers may submit completed forms by mail.
    • Ensure the form is postmarked no later than February 28.
    • Mail to:
      Office of Finance
      P.O. Box 53200
      Los Angeles, CA 90053-0200
    • Always include the correct year’s form (e.g., City of Los Angeles Business Tax Renewal Form 2016 for 2016 taxes).
  3. In-person Filing:
    • Business owners can visit one of the Office of Finance locations for in-person help, especially if dealing with complex classifications or penalty disputes.

Tax Renewal Development of Internet Businesses

In 2010, the City Council accepted a decree that added two new classifications for internet-based business to the renewal form: “Internet-Based Application Service Providers” and “Internet-Based Data Manipulation.” For these new groups, the business rate is $1.01 per $1,000 of gross receipts. These groupings and rates were prolonged in 2014 and will expire in 2018, immediately after the tax period.

This updated renewal form consists of different sections. For the sake of this post, however, we'll only discuss section 1 and 2.

  • Section 1: Taxpayer information. This section must include the account number, current legal name, DBA (if applicable), your business address, and the mailing address that is on file in the City of Los Angeles database.
  • Section 2: Tax Reform and Incentives. This section provides detailed steps for small businesses to receive an exemption. Small businesses within the City of Los Angeles can receive an exemption if their gross receipt did not surpass $100,000 worldwide in the calendar year 2016 or if they filed for renewal prior to February 28, 2017.

Business tax renewals are mandatory but can be tricky. It is therefore wise to get advice from professionals.

County-Level Business License Renewal (LA County vs. LA City)

While this article primarily covers the City of Los Angeles Business Tax, businesses located in unincorporated areas of Los Angeles County must also comply with LA County business license renewal requirements.

For LA County:

  • Renewals are typically managed by the Treasurer and Tax Collector (TTC).
  • Businesses can pay online via the LA County TTC site.
  • The license must be renewed annually and must remain posted at your business location.

City and county business taxes and licenses are separate obligations. If your business operates in both jurisdictions, you may need to file with both entities.

Penalties for Non-Compliance

Failing to file or pay the LABT renewal by the February 28 deadline can result in steep penalties:

  • Initial Penalty: 5% of the tax due, applied on the day after the due date.
  • Ongoing Penalties: An additional 5% is charged per month for each of the next two months.
  • Extended Delinquency: A 20% penalty is applied for longer-term non-payment.
  • Total Penalty Cap: 40% of the tax due plus interest.

Note that penalties are based on when the return is received, not when it was mailed. This is particularly critical for mailed returns—always ensure timely postmarking.

How to Fill Out the City of Los Angeles Business Tax Renewal Form 2016

The City of Los Angeles Business Tax Renewal Form 2016 includes multiple sections that must be completed accurately:

  • Section 1 – Taxpayer Information:
    Verify and update your legal name, business address, mailing address, and BTRC number.
  • Section 2 – Exemptions and Credits:
    Indicate if your business qualifies for a small business exemption (gross receipts under $100,000 worldwide in 2016).
  • Section 3 – Business Activities:
    Select the appropriate business classification. If engaged in multiple activities, allocate gross receipts accordingly.
  • Section 4 – Gross Receipts Reporting:
    Enter your total gross receipts for the 2016 tax year. Be accurate—underreporting can trigger audits or penalties.
  • Section 5 – Calculation and Payment:
    Use the appropriate tax rates for your classification to compute tax owed. Include any overpayments or credits from prior years.

Make sure to sign and date the form. Keep copies of the completed form and supporting documents for your records.

Frequently Asked Questions

  1. What is the City of Los Angeles Business Tax Renewal Form 2016 used for?
    It was used to renew and report gross receipts for the 2016 tax year. Businesses must submit this form annually with updated information for the applicable tax year.
  2. What happens if I file my LABT renewal late?
    Late filings incur a 5% penalty initially, increasing up to 40% plus interest depending on how late the payment is.
  3. Can I file my LABT renewal online?
    Yes, you can file online at the City of Los Angeles finance portal using your BTRC number and PIN.
  4. Do I need to file if I made no income in Los Angeles?
    Yes. All registered businesses with nexus in Los Angeles must file annually, even if no tax is due.
  5. What’s the difference between LA County and LA City business renewals?
    LA City’s LABT applies to businesses within city limits, while LA County manages business licenses for unincorporated areas. Each has its own renewal process.

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