It has come to our attention that you have received information from McDonald’s Corporation related to sales tax being charged on bottled water in the restaurants.
We recommend following McCopco’s lead and to stop charging sales tax on sales of bottled water. Bottled water is exempt in Florida, except in cases where carbonation or flavorings have been added during the manufacturing process.
If you were previously charging tax, this will require making changes to your POS systems so that the bottled water is no longer taxable.
These sales will now be reported as exempt sales on your sales reports, as well as your sales tax returns. We recommend keeping proper documentation with your monthly sales tax returns to support the items rung up as exempt, i.e. school exempt sales vs. bottled water sales, in case of audit.
If customers request a refund for sales tax collected on bottled water we recommend you refund the tax. If the tax has already been remitted to the Florida Department of Revenue, a credit can be taken on line 6, Lawful Deductions, of your DR-15 sales tax return.
If you have any further questions related to this issue, or need assistance reporting this information on your sales tax return, please feel free to contact us.