Updates for B&O Tax effective January 1, 2022

•  Ordinance No. 4295, adopted on November 20, 2018, increased the Gross Receipts Tax rates for certain classifications effective January 1, 2022.
  • The rates for Manufacturing, Retailing, Printing or Publishing, Extracting for Hire, and Processing for Hire have increased to 0.001.
  • The rates for Extracting, Retail Services, and Service and Other Activities have increased to 0.002.
  • There was no change to the Wholesaling rate (0.002).

• For businesses with facilities located in Kent, we have published Business Tax Rule 3-28-001 Square Footage Tax to educate, inform, and assist taxpayers with filing accurate returns. The rule affirms existing City practice and provides clarity regarding the Square Footage Tax. This material is located on the Tax Rules and Publications page of this site.

Register, File and Pay My Taxes

• Taxpayers are encouraged to register, file and pay B&O taxes at TaxFile.KentWA.gov. Online filing is free, fast, secure and typically results in fewer errors and omissions.

An access code is needed to register online. We will send your access code by mail after the first time you apply for a City of Kent business license. If you already have your business license but do not know your access code, please contact the Tax Division at (253) 856-6266 or at CityTaxes@KentWA.gov.  

• Alternatively, you may print and mail a tax return form.
  • 2024 Quarterly Tax Return
  • 2023 Annual Tax Return
  • B&O tax return forms for previous years may be requested by contacting the Tax Division. 

What is the Business and Occupation tax?

The Business & Occupation (B&O) tax is comprised of two components: The Gross Receipts Tax and the Square Footage Tax. Taxpayers with a place of business inside City limits must report both components, while taxpayers with places of business located entirely outside City limits are required to only report the Gross Receipts Tax. For taxpayers reporting both Gross Receipts Tax and Square Footage Tax, the tax due is based on the greater amount of the two categories.

What are the B&O tax Classifications and Rates?

The Gross Receipts Tax classification depends on the type of business activity engaged in. Business conducting more than one activity are required to report the gross income from each activity in the appropriate classification.

The Gross Receipts Tax applies if gross income in Kent exceeds $250,000 for the calendar year. For businesses that exceed that amount, a tax credit is granted so that tax applies only to gross income of more than $250,000 for annual filers or $62,500 for quarterly filers.

The Gross Receipts Tax classifications and applicable tax rates are as follows:

Definitions for the above tax categories are outlined in Section 3.28.030 of the Kent City Code.

The Square Footage Tax applies to taxpayers that lease, own, occupy or otherwise maintain business warehouse space, outdoor warehouse space, or other business floor space in excess of the threshold amounts within Kent. The Square Footage Tax classification depends on the type of business activity engaged in at the place of business. 

Businesses must report all square footage applicable to each square footage classification listed below.  Businesses exceeding either or both the Business Warehouse Floor Space and/or the Other Business Floor Space minimum thresholds are subject to the Square Footage Tax for the entire taxable indoor area.  Businesses exceeding the Outdoor Warehouse Space threshold are subject to the Square Footage Tax for the entire taxable outdoor area.

The applicable Square Footage Tax thresholds and rates are as follows:  

Persons with more than one place of business must report the total square footage of all business locations within the City. Definitions for the above tax categories, as well as non-taxable activities, are outlined in KCC 3.28.050(B).

When do I File and Pay the B&O tax?

Taxpayers may request to be assigned an Annual filing frequency or an Active Non-Reporting status.  Otherwise, the B&O tax is paid Quarterly on the following schedule:

If approved by the Tax Division, and the annual B&O tax liability is less than $1,000, then the taxpayer may be placed on an Annual filing frequency as follows:

If the payment due date falls on a weekend or a holiday, then the payment is due the following business day.

Tax returns filed and paid late are subject to late return penalty as follows (with a $5 minimum):

Returns that are filed online can be paid online with a credit/debit card or via eCheck.

• Credit and Debit Card – A service fee of 2.65% will be charged to your Visa or Mastercard. You will need to enter the card information to make a one-time payment.
• eCheck – A service fee of $0.85 will be charged for this transaction. If you have debit restrictions placed on your bank account, you will need to provide your bank with the City’s company code to ensure the transaction is authorized by your bank. The City’s Company Code is B2B7912916.
• The service fee is charged to process credit card, debit card, and eCheck transactions.  This fee is paid to the provider of this service, and no part of this fee goes to the City of Kent. 

How do I Amend a Previously Submitted B&O Tax Return?

1. Use a copy of the originally filed tax return and on the top of the page write “AMENDED” in large letters. You may obtain a copy of your return in your online account at taxfile.kentwa.gov.
2. Strike through any erroneous figures and make the appropriate corrections on the return. 
3. If you owe additional tax, then mail a check including your amended return and a written explanation of the reason(s) for the changes.
4. If you are owed a refund, you may request the refund in writing to the Tax Division either by mail at the address below or by email. State the basis for the refund and include supporting documentation. A refund may be claimed for taxes paid up to four years prior to the current calendar year.
5. Mail amended return(s), supporting documentation and, if tax is due, a check to: City of Kent, Attention: Customer Service, 220 4^th Avenue South, Kent, WA 98032-5895.

How do I Obtain Tax Returns Previously Filed? 

Previously filed returns are available in your online account at taxfile.kentwa.gov. Alternatively, you may request copies of your returns by contacting the Tax Division.

Questions?

• View the Guide to Kent's Business and Occupation Tax
• Contact the Finance Department Tax Division at (253) 856-6266 or CityTaxes@kentwa.gov
• Visit our Business Licenses page for questions regarding business licensing

What is the utility tax?

The City of Kent imposes a utility tax upon every organization that provides a utility service inside of City limits.  This tax is imposed directly on the provider of these services.  Typically the provider passes the cost of this tax onto its customers.   

What is the utility tax rate?

The utility tax is imposed directly on the provider of the utility service as a percentage of gross income as follows:

The provider of the utility service remits the utility tax to the City.  With the exception of water, sewer and drainage service, the provider of utility services may pass the cost of this tax onto its customers, i.e. appears on customer’s bill as “effect of city tax”.  Water, sewer and drainage taxes are included in the related utility service rates.  

Definitions for the above activities are contained in Section 3.18.010 of the Kent City Code. 

The tax does not apply to the following:

• The actual amount of credit losses and uncollectible receivables sustained by the taxpayer.

• Amounts derived from transactions in interstate and foreign commerce which the City is prohibited from taxing under the laws and Constitution of the United States.

Utility taxes are due on a monthly basis on or before the last day of the following month in which the tax is accrued.  For example, the June tax return is due by July 31. 

Taxpayers who owe less than $1,000 per month may submit tax returns on a quarterly basis on or before the last day of the month following the end of the calendar quarter. For example, the Quarter 1 return covering January through March is due by April 30.

If the due date falls on a weekend or on a holiday, then the due date is the next working day.  

How do I file and pay a utility tax return?

• Print and mail a Utility Tax Return form with applicable payment. Forms may also be obtained by request to the Tax Division.

           OR

• File and pay your return in person with our Customer Service Division located at 400 West Gowe Street Suite 122, Kent, WA 98032. Hours of Operation:  Monday – Friday, 9 a.m. to 4 p.m.

Questions?

• The requirements governing the City of Kent Utility Tax are established through Chapter 3.18 of the Kent City Code.  
• View the Solid Waste Utility Tax Guide.
• Contact the Tax Division at (253) 856-6266 or at CityTaxes@kentwa.gov. 

What is the gambling tax?

Subject to certain exemptions, the City of Kent imposes a gambling tax upon every person, association, and organization that engages in gambling operations inside of the City limits.  All persons, associations, and organizations engaged in gambling activities must be duly licensed by the Washington State Gambling Commission.  This tax is imposed directly on the organization providing the gambling events, and the organization is required to remit this tax to the City.  

What is the gambling tax rate?

The gambling tax is imposed directly on the organization providing the event as a percentage of gross revenues less the amount awarded as cash or merchandise prizes, as follows:

Definitions for the above activities are contained in Chapter 9.46 of the Revised Code of Washington.

The tax does not apply to any bona fide charitable or nonprofit organization as follows:

• The organization has no paid operating or management personnel and has gross receipts from bingo or amusement games, or any combination thereof, not exceeding $5,000 per year less the amount awarded as cash or merchandise prizes.

• The first $10,000 per year of gross receipts from raffles, less the amount awarded as cash or merchandise prizes.

When are the gambling tax returns and payment due?

Gambling tax returns are due on a quarterly basis on or before the last day of the month following the end of the calendar quarter as follows:

 If the due date falls on a weekend or on a holiday, then the due date is the next working day.  

How do I file and pay gambling tax returns?

• Print and mail a Gambling Tax Return form with applicable payment. Forms may also be obtained by request to the Tax Division.

OR

• File and pay your return in person with our Customer Service Division located at 400 West Gowe Street Suite 122, Kent, WA 98032. Hours of Operation: Monday - Friday, 9 a.m. to 4 p.m. 

 Questions?

The requirements governing the City of Kent Gambling Tax are established through Chapter 3.21 of the Kent City Code.  You may also contact the Tax Division at (253) 856-6266 or at CityTaxes@kentwa.gov. 

What is the admissions tax?

The City of Kent imposes an admission tax upon every person who pays an admission charge for entry to a qualifying event, subject to certain exemptions.  This tax is imposed directly on the customer.  The organization imposing the related admission fee is required to collect and remit this tax to the City.

What is the admissions tax rate?

The admissions tax is calculated based on five percent (5%) of the monetary admissions charge. If the admissions charge is accompanied by a service charge, the admissions tax is also due on the service charge. The tax on reduced admissions charges is calculated based on the reduced charge and not on the regular admissions charge.

What activities or events are subject to admissions tax?

In addition to its usual and ordinary meaning, the admission tax means a monetary charge for an event including, but not limited to the following:

• Season tickets or subscriptions.
• Cover charge or a charge made for use of seats, tables and similar accommodations.
• If a general admissions fee is charged for entry onto the premise where a rental occurs and if the rental of equipment or facilities is necessary for the enjoyment of a privilege for which the general admission is charged.
• Automobile parking charges if the amount of the charge is determined according to the number of passengers in the automobile.
• Any other charge for entrance and observation.

The tax does not apply to the following types of organizations:

• Elementary or secondary schools
• Events sponsored by nonprofit tax-exempt organizations if the nonprofit organization publicly sponsors and promotes the event and the nonprofit tax-exempt organization receives the use and benefit of the admission charges collected. 
• Any governmental entity except for activities operated in the manner of a separate business and operated as a business activity in a separate fund.

When are the admissions tax returns and payment due?

Admissions tax returns are due on a quarterly basis on or before the last day of the month following the end of the calendar quarter as follows:

If the due date falls on a weekend or on a holiday, then the due date is the next working day.  

How do I file and pay an admissions tax return?

• Print and mail an Admissions Tax Return form with applicable payment. Forms may also be obtained by request to the Tax Division.

OR

• File and pay your return in person with our Customer Service Division located at 400 West Gowe Street Suite 122, Kent, WA 98032. Hours of Operation: Monday - Friday, 9 a.m. to 4 p.m. 

Questions?

The requirements governing the City of Kent Admissions Tax are established through Chapter 3.26 of the Kent City Code.  You may also contact the Tax Division at (253) 856-6266 or at CityTaxes@kentwa.gov. 

Tax Rules and Publications

The following materials are designed to educate, inform, and assist businesses in filing tax returns with the City. For additional information regarding City taxes, you may refer to the information shown above on this page or contact the Tax Division at 253-856-6266. 

Tax Rules

3-28-001 Square Footage Tax

Tax Advisory Notices

2022-01 Self-Storage Rental Businesses

Tax Guides

Business and Occupation (B&O) Tax Guide 

Solid Waste Utility Tax Guide