Yes, it's finally happening. Starting October 1, 2025, Florida will no longer charge state sales tax on commercial rentals. No more doing mental gymnastics every time you explain lease costs to a client. No more 2 percent state sales tax. No more county surtax either. Clean, simple lease math is making a comeback.
What’s Changing?
Effective October 1, 2025, the state is repealing the sales tax under Section 212.031 of the Florida Statutes. That means no more tax on rent or license fees for use of commercial property for periods beginning on or after that date.
Here’s what that includes:
If you’ve been collecting or paying sales tax on any of these, that’s all ending soon.
What’s Not Changing?
There are still a few things that remain taxable, even after the repeal:
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Short-term rentals of living spaces (six months or less)
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Parking spaces in lots or garages
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Boat docks or marina slips
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Aircraft tie-downs or storage
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Rent paid for periods before October 1, 2025, regardless of when the payment is made
So if a tenant pays for August rent in October, yep, that still needs to be taxed and reported.
Landlords: Here’s What You Need to Do
If your Florida tax account is only used to report commercial rent tax, you must keep filing your returns through the September 2025 period.
Breakdown by filing frequency:
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Monthly filers: Keep filing July, August, and September 2025
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Quarterly filers: Final return is July through September 2025
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Semiannual filers: Last report is July through December 2025
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Annual filers: File through 2025, but don’t report any rent for October or later if it’s non-taxable
Even if no tax is due, you still need to file that final return. After that, the Department of Revenue will update your account automatically. No need to manually close it.
If your account also handles other taxable items like retail sales, you continue as usual. This only affects commercial real property rentals.
Common Questions:
If my tenant pays October rent early in September, do I charge tax?
No. Payments made before October 1 for periods beginning October 1 or later are not taxable.
If my tenant pays for July rent in October, do I charge tax?
Yes. The tax follows the rental period, not the payment date.
Do I report non-taxable rent on my returns?
No. Once the rent is non-taxable, you do not report it.
Already collected sales tax on post-October rent?
You must refund the tax to your tenant before requesting a refund from the Department of Revenue. Use Form DR-26S and provide proof.
I only rent out salon booths. Can I stop collecting sales tax?
Yes, starting with occupancy periods on or after October 1, 2025. But you still need to report anything collected for periods prior to that.
Will I still owe estimated tax payments in Q4 2025?
Not if your account was only for commercial rent. If you report other taxable activity, keep making payments as needed.
Paid sales tax to your landlord in error?
You, the tenant, must get your refund from your landlord, not the Department of Revenue.
What if I get late rent payments after October for previous periods?
You still owe the tax. Late payments do not escape taxation.
Bonus: Tax Credit Scholarships Are Changing Too
Due to this repeal, no new Tax Credit Scholarship allocations related to commercial rent will be issued after July 1, 2025. However, if a business has already made qualifying contributions, those can still be used against rent tax paid through September 2025.
Final Thoughts
This is a major win for commercial landlords, tenants, and anyone working in Florida's real estate market. It simplifies leasing costs, removes the guesswork from rent calculations, and makes Florida an even more attractive place to do business.
Properties that start leases in Q4 2025 or later will benefit immediately. So prepare now. Update your lease language. And enjoy the sweet, simple freedom of one less tax to pay.
Need Help or Have Questions?
Contact the Florida Department of Revenue:
