If you make sales in the United States, the US tax system may be difficult to understand. You will find here some elements to understand sales tax specifics.
Diversity of tax rates
Each US state sets its own tax rate, which may change. If you make sales in e-commerce or from abroad, your business may be subject the sales tax of the state in quesion. Five states have no sales tax: Alaska, Oregon, Montana, New Hampshire and Delaware.
What is Nexus?
Nexus refers to the fact that your business has a sufficient business presence to imply tax liability. Your business has a Nexus in the following cases according to the specific criteria of each US state:
- Physical Presence: Office, Warehouse, Store, or other location
- Employment of commissioned agents
- Staff employment
- Direct Delivery (if you have a supplier to ship inventory to customers)
- Sale of goods in a commercial event (fairs, trade shows)
- Storage of goods for sale in a US state. The sale via Amazon FBA is also concerned.
- The amount of sales made by your company in the US State in question is equal to or greater than $ 100,000 per year OR you make at least 200 transactions annually (these thresholds vary depending on the state).
How to pay the sales tax
If you have a Nexus in a US state, and are therefore liable for sales tax in that state, you will need to register to obtain a sales tax license from the state tax office. Once this license has been obtained, you will have to collect the sales tax in the state if the conditions are met.
If you do not have a physical establishment in the United States but are not sure if your sales operations trigger a Nexus, consult ASD Group experts.
Do you want to become a Non-Resident Importer (NRI) in the United States?
You can appoint a tax representative who will take care of registering your company, collect sales tax and keep records of all transactions, as well as liaising with the authorities.
ASD Group offers a tax representation / NRI service in the United States. Our experts are available for advice and information on your sales in the USA and your administrative procedures. Contact us!
This article is intended for informational use only and does not constitute legal, financial or tax advice. For specific advice applicable to your business, please contact us.