Instructions For Form Cr-A - Commercial Rent Tax Annual Return (Page 3 of 6) in pdf

Instructions for Form CR-A for the Period of June 1, 2009 to May 31, 2010 ONLY

Page 3

e) where the tenant is a corporation and the

Where the base rent is for a period of less

EXEMPTIONS

building is owned by an officer or stock-

than one year, it must be annualized. Base

The following are exempt from payment of

holder of the corporation.

rent is annualized by assuming it was paid

the Commercial Rent Tax:

on an equivalent basis for the entire year.

WHAT CONSTITUTES

1. a tenant whose annualized base rent be-

TAXABLE PREMISES

In computing base rent, rent received from

fore the 35% rent reduction and the NYC

Taxable premises are premises used or in-

a subtenant subject to the tax or exempt from

Commercial Revitalization Program spe-

tended to be used to carry on any trade, busi-

the tax for the tax year because the sub-

cial reduction (line 5b) is less than

ness, professional, vocational or commercial

tenant's annualized base rent before the 35%

$250,000 for period beginning on or after

activity, including premises used solely for

rent reduction and the NYC Commercial Re-

June 1, 2001. The annualized base rent

the purpose of renting the same in whole or

vitalization Program special reduction is less

for a period of less than one year is de-

in part to subtenants. Taxable premises in-

than $250,000 for period beginning on or

termined as if the rent had been paid on

clude a specific part of particular space in a

after June 1, 2001, and rent received from a

an equivalent basis for an entire year;

warehouse rented for the storage of goods,

subtenant that is a governmental entity, the

or in a garage, parking lot or parking area

United Nations, or a nonprofit religious,

2. a tenant who uses premises for 14 days or

rented for the parking of motor vehicles, in

charitable or educational entity exempt from

less (whether or not consecutive) in a tax

connection with the tenant’s conduct of busi-

the tax may be deducted by a prime tenant.

year, and is not required to pay rent for a

ness or professional activity; also included

longer period;

is a safe deposit box or locker or beach ca-

NOTE: Base rent paid by a tenant for one

bana if used for business purposes.

taxable premise cannot be reduced by de-

3. a tenant (other than the operator of a

ducting rents received by that tenant for an-

hotel, apartment hotel or lodging house)

WHAT CONSTITUTES RENT

other taxable premise of which he is also a

who uses premises for residential renting

Rent is the consideration paid or required to

tenant.

to others to the extent of 75% or more of

be paid by a tenant for the use or occupancy of

the rentable floor space;

premises, valued in money, whether received

A tenant is also entitled to deduct from the

in money or otherwise, including all credits,

base rent amounts paid by the tenant for the

4. a tenant who uses premises for certain dra-

property, or services of any kind, as well as

tenant’s own use of the premises:

matic or musical arts performances for less

any payment required to be made by a tenant

than 4 weeks where the performances are

on behalf of the landlord for real estate taxes,

a) for railroad, air, or omnibus transportation

not intended to continue for less than 4

water and sewer charges, or any other ex-

purposes;

weeks. A tenant who uses taxable premises

penses

(including

insurance)

normally

for the production and performance of a

payable by a landlord who owns the realty,

b) for piers, insofar as they are used in in-

theatrical work is exempt from the tax with

other than expenses for the improvement, re-

terstate or foreign commerce;

respect to the rent paid for the taxable prem-

pair or maintenance of the tenant’s premises.

ises for a period not exceeding 52 weeks

c) which are located in, on, above, or under

from the date production commenced. For

Where the rent paid by a tenant for the occu-

a public place and are defined by law as

purposes of this exemption, production will

pancy of taxable premises is measured in whole

special franchise property;

be considered to commence on the date

or in part by the gross receipts from the sales

public performances begin;

within the premises, the rent, for purposes of

d) which are advertising space or signs,

computing the Commercial Rent Tax is the ac-

vending machines, or newsstands in sub-

5. beginning August 30, 2005, tenants in the

tual percentage of gross receipts due the land-

way or elevated railroad premises oper-

World Trade Center Area, as defined in

lord, but not in excess of 15% of gross receipts.

ated by the New York City Transit

§11-704(a)(6) of the NYC Ad. Code. See

Authority when the rent is payable to the

“Highlights of New Legislation”;

Tenant shareholders in cooperative buildings

Transit Authority; or

should calculate the amount of rent subject

6. beginning December 1, 2005, for retail

to tax as provided in Section 7-01 “Rent” of

e) which is parking space subject to the ad-

sales purposes in the Commercial Revital-

the Commercial Rent Tax Rules. (Title 19,

ditional 8% parking tax imposed under

ization Program abatement zone.

See

Rules of the City of New York, Chapter 7)

Administrative Code Section 11-2049.

“Highlights of New Legislation” and Ad-

If a tenant uses two or more taxable loca-

ministrative Code §11-704(c)(9). Premises

tions in the same building at the same time,

NOTE: Report these deductions on line 5a

used for retail purposes are premises used

the total rent paid for all such locations con-

- Other Deductions and attach a schedule.

for the selling of tangible goods directly to

stitutes rent paid for one taxable premises.

the ultimate consumer. Administrative

For a more detailed discussion of deductions

Code §11-701(c)(20). Tangible goods in-

WHAT CONSTITUTES BASE RENT

in calculating base rent refer to Section 11-

clude such things as food, clothing and ap-

Base rent is generally the rent paid for each

704 of the NYC Administrative Code and

pliances, but do not include insurance,

taxable premises by a tenant to the landlord

Section 7-01 “Base Rent” of the Commer-

banking or other types of services; and

for a period, less the amounts received by or

cial Rent Tax Rules. (Title 19, Rules of the

due such tenant for the same period from any

City of New York, Chapter 7)

7. various governmental bodies, the U.N.,

subtenant of any part of the premises. (See

and nonprofit religious, charitable and

instructions to line 4, Rent from Subtenant(s))

educational organizations.

Other non-

Instructions For Form Cr-A - Commercial Rent Tax Annual Return Page 3

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