Q. What taxes are administered by the City of Northport Revenue Department?
A. Sales, Use, Rental, Lodgings, Gas, Wine, Liquor, Tobacco and Business Licenses.
Q. What are the tax rates?
A.
- Sales - General 3%, Automotive 1.125%
- Use - General 3%, Automotive 1.125%
- Rental - General 3%, Automotive 0.50%, Linens/Garments 1%
- Lodgings - 11%
- Liquor - 7% of purchase price
- Gasoline - $0.01 per gallon
- Tobacco
- Cigarettes $0.10 per pack (PJ $0.05 per pack)
- Cigars $0.02 per cigar (PJ $0.01 per pack)
- Smokeless Tobacco $0.10 per package (PJ $0.05 per pack)
Q. When are taxes due?
A. Taxes are due by the 20th day of the month following the reporting period in which the tax is collected or accrued. Liquor tax is due by the 15th day of the month.
Q. When is a City of Northport business license required?
A. A business license is required by any person or other entity prior to starting any service or business activity in the City of Northport.
Q. Why do I need to purchase a business license?
A. Each person located or engaged in any business, vocation, occupation or profession in the City of Northport or its Police Jurisdiction shall take out and pay a City business license. A license is required if you are doing business in the City, but not located in the City. Depending on the type of business you have, a license for both cities may be required. The Police Jurisdiction extends 3 miles around the corporate limits of Northport.
Q. What is the cost of an initial business license?
A. The cost of the initial license is based on your estimated gross receipts from the time you open until December 31st plus the base license fee. For a business located in the city of Northport there is a one time $30 application fee.
Q. What type of license do I need to open a business?
A. The type of license issued will be based on the type of business you will be operating. We can determine what type of license is necessary by asking you questions concerning your business. In several cases, more than one type of business license is required.
Q. What are the steps in getting a license?
A. The first step is determining where your physical location will be. If this location is inside the city limits or its police jurisdiction, then you will be required to get your business location approved through a Code Compliance. Once this Code Compliance is complete, then a business license will be issued based on your estimated gross receipts for the remainder of the calendar year. When the license is renewed at the end of the partial year, an adjustment to the amount originally paid will be made on the next year's license amount. A license is required if you are doing business in the City, but not located in the City. You will also need to check with other governmental agencies to see whether or not a license is needed. The following is a list of the local agencies:
License and Business Tax Information
Northport Revenue Division
3500 McFarland Boulevard
Northport, AL 35476
(205) 339-7000
Tuscaloosa County Special Tax Board
2620 6th St
Tuscaloosa, AL 35401
(205) 722-0540
State of Alabama Dept. of Revenue, Tuscaloosa Taxpayer Service Center
1434 22nd Ave
Tuscaloosa, AL 35401
(205) 759-2571
City of Tuscaloosa
2201 University Blvd
Tuscaloosa, AL 35401
(205) 248-5311
Q. How long does it take to acquire a business license?
A. If the business is physically located in Northport, then the various city departments must approve your location before you can open for business. If you are located outside the City, then the license can be issued that day.
Q. When does the license expire?
A. All City licenses expire December 31st and you have until February 15th to renew without a penalty.
Q. Do I need to be tested for a contractor's license?
A. The State and County require no testing. However, you may need to contact the State Contractors Board at (334) 272-5030.
Q. On what is the contractor's license fee based?
A. It is based on the previous year's gross receipts less payment made to licensed sub-contractors. First year businesses must estimate their gross receipts through December 31st of that year.
Q. What type of license is needed to clean homes or apartments?
A. We require a business license if you are receiving any compensation for cleaning a home or apartment.
Q. What do I need to open a food service of any type?
A. You must be approved by the various departments and have a Health Department permit.
Q. What is required for a retail automobile license or wholesaler automotive license?
A. You must complete our requirements for a business license.
Q. I am selling products from my home (jewelry, baskets, etc.). What type of license would I need?
A. You are required to have a license but the type of license required varies.
Q. Is a license required for lawn work (cutting grass, raking, etc.)?
A. You are required to have a business license if you are located, or if you are performing services in the City of Northport or the Northport Police Jurisdiction.
Q. Is a license required for washing cars?
A. Yes.
Q. What kinds of taxes does the Revenue Department administer?
A. The Revenue Department administers, collects and enforces several types of taxes: The following is a list of the taxes administered, collected and enforced by the City of Northport Revenue Department:
- Sales Tax
- Sellers Use Tax
- Consumers Use Tax
- Rental Tangible Personal Property Tax
- Liquor Tax
- Lodgings Tax
- Tobacco Tax
- Residential Rental Tax
- Business License
Q. What is Sales Tax?
A. Sales Tax is a privilege tax imposed on the retail sale of tangible personal property. The tax is collected by the seller from their customers and remitted directly to the City of Tuscaloosa or the City of Northport. All sales of tangible personal property are retail sales except those defined as wholesale sales.
The total sales tax percentage for Tuscaloosa County is 10 percent. The breakdown is as follows:
For sales made within the City Limits of Northport:
- City - 3%
- County - 3%
- State - 4%
For sales made outside the City Limits of Northport, but within our police jurisdictions: (1/2 of above rate)
- City - 1.50%
- County - 4%
- State - 4%
Q. What are wholesale sales?
A. Wholesale sales are sales of tangible personal property to licensed merchants, jobbers, dealers, or other wholesalers for resale. It does not include sales to users or consumers that are not for resale. The seller must maintain the sales tax number or exemption number for these customers.
Q. When is Sales tax due?
A. The sales tax is due monthly, with returns and remittances to be filed on or before the 20th day of the month for the previous month's sales. However, beginning with the calendar year 1999, a taxpayer may elect to file and pay sales tax on a calendar quarter basis if the total State of Alabama sales tax for which the taxpayer is liable averages less than $200 per month during the preceding calendar year. Also, if a taxpayer's total State of Alabama sales tax liability during the preceding year is $10 or less, the taxpayer may file sales tax on a calendar year basis. The request to file quarterly or on a calendar basis must be made in writing to the taxing jurisdiction.
Q. If the 20th falls on a weekend or holiday, when is the due date?
A. To be considered a timely filing, the return must be postmarked on or before the next working day, or paid in the revenue office the first working day following the weekend or holiday.
Q. Is the seller allowed a discount for timely filing and paying the sales tax that is due?
A. Yes. A discount is allowed if the tax is paid before the 20th day of the month in which the tax is due. The sales tax discount consists of 5 percent on the first $100 of tax due, and 2 percent on all tax over $100. Please note, however, that the monthly discount may not exceed $200.
Q. Is there a penalty imposed for not filing timely and not paying the sales tax that is due?
A. The penalty is the same as the State of Alabama. The penalty for failure to file is 10 percent or $50, whichever is greater, and 10 percent for failure to pay.
Q. What is Rental Tangible Personal Property tax?
A. Also known as rental tax, this tax is a privilege tax levied on the lessor for the leasing or renting of tangible personal property. Gross receipts, including any rental of tangible personal property are subject to the rental tax at the following rates:
- If lessee is located inside the City of Northport:
- Automotive vehicles - 1/2 of 1% (.005)
- Lines and garments - 1% (.01)
- General Rates - 3% (.03)
Police Jurisdiction rate would be ½ of the above listed rate.
Q. What is Consumers Use Tax?
A. This tax is for tangible personal property bought for use, storage, or consumption in which the seller did not collect tax on the sale of the property.