California Sales Tax for LLCs — Rates & Collection

California has the highest base state sales tax rate in the US (7.25%), with local additions bringing the total to 7.25%-10.75% depending on location. If your LLC sells taxable goods, you must register with the California Department of Tax and Fee Administration (CDTFA). For the complete picture, see our CA LLC tax guide.

California Sales Tax Rates

Major city rates:

• Los Angeles: 9.5%-10.25% (varies by district)
• San Francisco: 8.625%
• San Jose: 9.375%
• San Diego: 7.75%
• Sacramento: 8.75%

What Is Taxable

Taxable: Most tangible personal property (goods), leases of tangible property, certain digital products.

Exempt: Groceries (unprepared food), prescription medicine, most services (consulting, legal, medical, professional).

Note on SaaS: California does NOT tax software-as-a-service (SaaS) — it is considered a non-taxable service. This matters for tech LLCs.

Registration

Register with the CDTFA for a seller's permit:

• Online at https://onlineservices.cdtfa.ca.gov/
• No fee for the permit itself
• Required BEFORE making any taxable sale

FAQ

Does my LLC need a seller's permit if I only sell online?

If you sell taxable goods delivered to California customers and have CA nexus: yes. Marketplace facilitators (Amazon, Etsy) handle collection for marketplace sales.

Is software taxable in California?

Pre-written software delivered on physical media: taxable. SaaS (cloud software): not taxable. Custom software: not taxable. Downloaded software: partially taxable (complex — consult CDTFA guidance).