Frequently asked questions about sales tax
Do non-US sellers have to collect tax on US sales?
Non-US sellers may be required to collect US sales tax, depending on a number of factors.
What determines whether a non-US seller is required to collect sales tax in the United States?
The obligation to collect sales tax is generally determined by the existence of a tax nexus in a given US state. The Nexus can be established on the basis of various factors such as physical presence, economic activity or the attainment of specific thresholds set by each State.
How do non-US sellers determine their tax nexus for US sales?
Non-U.S. sellers can determine their sales tax nexus by evaluating their activities in each U.S. state, taking into account factors such as physical presence (e.g. office, employees, warehouses), inventory storage, sales volume or whether they meet economic thresholds set by each state.
Are there any thresholds or exemptions for non-US sellers when it comes to collecting sales tax?
The thresholds and exemptions for collecting sales tax vary from state to state. Some states set economic nexus thresholds based on turnover or transaction volume. It is important to check the specific requirements of each state where sales are made.
What are the registration requirements for non-US sellers wishing to collect sales tax in the United States?
Registration requirements vary from state to state. Non-US sellers must generally register with the tax authority in each state where they have a nexus. To do this, they must complete registration forms and provide the necessary information.
How often do non-US sellers have to file US sales tax returns?
The frequency of sales tax returns depends on state regulations. It may be monthly, quarterly or annually. Some states may require more frequent returns where the volume of sales is greater.
Are there any options or simplified software to help non-US sellers comply with sales tax?
Yes, there are a number of software and service providers that can help non-U.S. sellers automate tax calculations, file returns and manage U.S. sales tax compliance.
Can non-US sellers claim a refund of the sales tax paid on purchases for resale?
Non-US sellers can claim a sales tax refund for purchases made for resale. Each state has its own rules and procedures for claiming these refunds.
Are there any specific rules or considerations for digital products or services sold by non-US sellers in the US?
Yes, there may be specific rules and considerations for digital products or services sold by non-U.S. sellers, such as the application of sales tax to digital goods or services and the potential need to collect tax on digital downloads or subscriptions.
What are the penalties for non-compliance with US sales tax requirements by non-US sellers?
Penalties for non-compliance with U.S. sales tax requirements vary from state to state and can include fines, interest on unpaid taxes and other enforcement actions. It is important to comply with sales tax obligations to avoid potential penalties.
