Starting October 1, 2025, Florida will officially end the state sales tax and any local surtaxes on commercial property rent. After that date, sales tax will no longer apply to rent for office buildings, retail spaces, warehouses, and self-storage units. Sales tax will still be applicable, however, for short-term rentals (leases under six months), for vehicle, boat, and aircraft parking or storage, as well as for rentals in hotels, motels, or similar lodging.

Commercial rent collected for lease periods starting on or after October 1 will be fully exempt from sales tax. Note, however, commercial rent due for any period prior to October 1 will still be subject to sales tax, even if that rent is collected after October 1. For example, if your tenant pays September rent in October, that rent will still be subject to sales tax. On the other hand, if a lease starts October 1 or rent is not due until after October 1, and the tenant pays rent early, the exemption will apply.

If you collect sales tax from commercial rent, your final return will be due for the period ending September 30. The Florida Department of Revenue will take care of closing out your account automatically. No further action is needed on your end.

If you accidentally charge sales tax for commercial rent due in October or later, you will need to first refund the tenant. After that, you can apply for a refund from the Florida Department of Revenue.

We recommend that you take the following steps: (1) update your lease templates and rent payment schedules, (2) make sure your billing and accounting systems stop charging sales tax after September, (3) notify tenants about the change, and (4) talk with your accountant or tax advisor about proper handling of proration and potential refunds, as well as other tax matters.