Lee58
Member
This is a question for those who ship products. Do you charge sales tax on the shipping cost?
Sales Tax Question
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jttheclockman
Member
Tough question. Depends on the state. Depends on the listing. If you list seperately technically no but if you include shipping in total cost than yes.
darrin1200
Member
It really depends on your location, as every State/Province has their own rules.
Here in Ontario Canada, you are required to collect the tax on goods and services. Shipping is a service you are offering, so you need to collect it. That said, here in Ontario, you are not required to collect Tax unless you exceed IIRC $35000 in gross sales. However, in Alberta, Canada, there is now provincial sales tax, just Federal sales tax.
But it's also a law in Canada, that you must follow the rules of, and collect the provincial Sales Tax for, the province in which the product is sold. Unfortunately this considered to be location of the buyer. If I'm not mistaken, this has become a similar law in the US, between States.
This is all to say, that broad tax questions are difficult to answer. You really need a local expert. See if you have a local Chamber of Commerce, or Economic Development Centre.
Here in Ontario Canada, you are required to collect the tax on goods and services. Shipping is a service you are offering, so you need to collect it. That said, here in Ontario, you are not required to collect Tax unless you exceed IIRC $35000 in gross sales. However, in Alberta, Canada, there is now provincial sales tax, just Federal sales tax.
But it's also a law in Canada, that you must follow the rules of, and collect the provincial Sales Tax for, the province in which the product is sold. Unfortunately this considered to be location of the buyer. If I'm not mistaken, this has become a similar law in the US, between States.
This is all to say, that broad tax questions are difficult to answer. You really need a local expert. See if you have a local Chamber of Commerce, or Economic Development Centre.
lyonsacc
Member
Depends on the state (I know, they said that above). Keep in mind, you generally only need to collect sales tax in states that you have "nexus" in. And that also is defined differently by state. But it usually means that you have some sort of physical presence in that state - If you go to Alabama for a couple of shows, then maybe you have a physical presence in that state. So, if you don't venture out of Texas for your pen business, you likely only need to collect sales tax on sales located in Texas.
www.nolo.com
I just looked through the Texas code real quick and didn't see the answer about shipping. You could give the Secretary of State's office a call, ask for the sales tax department and ask them. Most of the states we call are really helpful.
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www.nolo.com
I just looked through the Texas code real quick and didn't see the answer about shipping. You could give the Secretary of State's office a call, ask for the sales tax department and ask them. Most of the states we call are really helpful.
In Texas, shipping costs are taxable if the sale is taxable and exempt if the sale is exempt.
MRDucks2
Member
Edgar has the answer. Texas likes to put sales tax on everything it can.
Indiana likes to make it as confusing as possible. Goods are taxable, unless food for preparation but not food for serving, it gets taxed, services are not taxable but some services may be, sales tax is now collect for out of state sales coming in if a company does something like $300-350k annual in the state. But out of state sales are not taxed by Indiana. And, of course, then we get into the exemptions.
Indiana likes to make it as confusing as possible. Goods are taxable, unless food for preparation but not food for serving, it gets taxed, services are not taxable but some services may be, sales tax is now collect for out of state sales coming in if a company does something like $300-350k annual in the state. But out of state sales are not taxed by Indiana. And, of course, then we get into the exemptions.