Florida restaurant owner

There is considerable confusion amongst Florida restaurant owners as to who is responsible for collecting and remitting sales tax for orders from Grubhub, Ubereats and all the other 3rd party apps. 

The simple answer is NO, restaurants are not responsible for collecting and paying sales tax on orders from 3rd party apps. It is the responsibility of the 3rd party apps to collect and remit sales tax to the state of Florida for these orders.    

The State of Florida Department of Revenue refers to Technical Assistance Advisement 14A-025 which states:

“With respect to your question concerning whether the franchisee (ie Grubhub, Ubereats, etc.) should remit the sales tax collected directly to the Department of Revenue, the answer is “yes.” The franchisee is not acting in the capacity of a conduit or agent for a restaurant to collect money from the customer. According to the agreement between the taxpayer and the restaurants, the franchisee purchases the meals at a discount (e.g., 30%) off the menu price. Revenue generated by the franchisee does not belong to the restaurant and at no time does this revenue become the property of the restaurant. Franchisee conducts its business, advertises, and collects revenue as a separate and distinct legal entity, and not as a distributor or salesperson for participating restaurants. It is the franchisee’s intent to attract public attention to it as a person in the business of selling to its customers a variety of meals prepared by a variety of restaurants, to be delivered directly to the customer. Accordingly, all taxes due from the purchasers must be remitted directly to the Department of Revenue by the franchisee. “

What this says is that at no time does the revenue of the order from Grubhub belong to the restaurant and therefore they are not responsible for collecting and remitting sales tax to the State of Florida. Third-party apps are in the business of selling their services to the public including advertising, taking orders and collecting revenue and fulfilling delivery of the order to the customer. Grubhub collects the money from the customer and purchases the meal from the restaurant at a discounted price but the revenue of the sale never becomes the property of the restaurant.  

If you are wondering how to set up your POS to manage 3rd party orders and not charge sales tax, refer to our previous blog: Integrar Grubhub, Uber Eats y otras aplicaciones de terceros en su punto de venta para una mejor gestión del impuesto sobre las ventas.

If you have paid sales tax on 3rd party orders in the past, you may be entitled to a refund. Consult a tax professional about filing amended returns.