An often overlooked filing obligation by out-of-state companies who are unaware of Ohio’s tax structure and how it may apply to their business, is the Ohio Commercial Activity Tax (CAT). This is a tax imposed on business entities for the privilege of doing business in Ohio.
If you have more than $500,000 in Ohio taxable gross receipts derived from either:
- Sales of tangible personal property if the personal property is received in Ohio by the purchaser; or
- Performance of services where the purchaser ultimately uses or receives the benefit of the service in Ohio
If you have employees which work in Ohio or a business domiciled in Ohio; AND have at least $150,000 in Ohio taxable gross receipts, you likely have an Ohio Commercial Activity Tax liability.
The CAT tax can only be filed and remitted online (or by phone) by the business entity. Therefore, it is not part of the annual state tax returns prepared by Somerset. Taxpayers must register, file, and pay tax electronically via phone or the Ohio Business Gateway found at: http://business.ohio.gov/
Please contact your Somerset advisor at 317-472-2200 or at firstname.lastname@example.org if you need assistance in determining if you have a liability or assistance with filing this return.