Navigating Arkansas’ sales tax guidelines
Does your business need to file a sales tax return and remit regular sales tax payments to Arkansas? Businesses and online (or remote) sellers must understand the sales tax guidelines in each state where they sell their goods (or services). Each state has unique directives related to how sales are taxed. Learn more about physical and economic nexus guidelines in Arkansas and use TaxJar’s sales tax calculator to estimate how much sales tax your business needs to remit.
Do you need to collect sales tax in Arkansas?
You’ll need to collect sales tax in Arkansas if your business has either physical or economic nexus in the state. A business with physical nexus has a tangible presence in Arkansas, while businesses – or online sellers – with economic nexus have met the economic threshold for total revenue or total number of sales transactions established by the state of Arkansas.
Do you have physical nexus in Arkansas?
Arkansas considers a seller to have physical nexus if they have any of the following in the state:
- An office or place of business (owned or leased)
- A warehouse or agency in Arkansas (owned or leased)
- Real or personal property
The Arkansas Department of Revenue (the state’s taxing authority) explains in detail what constitutes sales tax nexus in its Arkansas Rules guide. Businesses and sellers can learn more about gross receipts tax rules, compensating use tax rules, and special excise tax rules. .”
Do you have economic nexus in Arkansas?
Arkansas considers vendors who make more than $100,000 in sales annually or more than 200 transactions in the state to have economic nexus. These vendors are obligated to collect sales tax from buyers in the state.
The Arkansas Department of Finance & Administration’s Remote Sellers page provides additional information about economic nexus; explore this resource to understand sales tax obligations. TaxJar also offers a guide that explains economic nexus in every state.
Is what you’re selling taxable?
If you’ve discovered you have sales tax nexus in Arkansas, your next step is to determine if what you’re selling is taxable. Services in Arkansas are sometimes taxable. Review the Arkansas Department of Finance and Administration’s Sales and Use Tax FAQs to learn more about taxable services in the state.
Tangible products are taxable in Arkansas, with a few exceptions, including certain items used in agriculture and construction, among other things. The Arkansas Rules guide lists the state’s non-taxable items (refer to page G).
The state sales tax rate in Arkansas is 6.5%. Calculate the full sales and use tax rate (including local tax) by using the TaxJar sales tax calculator.
Each year, a Back-to-School sales tax holiday is held in August, which gives exemptions for state and local sales or use tax on clothing under $100, clothing accessories or equipment under $50, and electronic devices, school supplies, school art supplies, and school instructional materials. Arkansas offers a list of exempted items online.
Is SaaS taxable in Arkansas?
SaaS is non-taxable in Arkansas. Both software delivered electronically or “by load or lead” is not considered taxable, and “the use of prewritten computer software in providing software programming services does not cause the programming services to become taxable unless tangible personal property is provided to the customer.”
How to get a sales tax permit in Arkansas
You can register online at the Arkansas Taxpayer Access Point (ATAP) or fill out the application. Just click “Sign up” and you’ll be prompted to enter business info, then register for your sales tax permit.
Business may also visit TaxJar’s registration page to request TaxJar manage your Arkansas registration.
What information do you need to register for a sales tax permit in Arkansas?
- SSN or ITIN number
- Business identification information
- Business entity type
- Nature of your business
- NAICS Code
It costs $50 to apply for an Arkansas sales tax permit. Other business registration fees may apply to some businesses.
Use the Streamlined Sales Tax™ Registration System (SSTRS)
Arkansas is a Streamlined Sales Tax™ Member state. The Streamlined Sales Tax™ Registration System provides a central hub for registering for sales tax permits in member states. The system helps to simplify the sales tax permit process for businesses and remote sellers that have economic nexus in multiple states.
Businesses can use the SSTRS to apply for a license in any member state. The site also lets businesses contract with a Certified Service Provider™ (CSP™ ), who provides sales tax concierge services and tax assistance in any state in which the register via the SSTRS.
How to collect sales tax in Arkansas
Arkansas is a destination-based sales tax state. So no matter if you live and run your business in Arkansas or live outside Arkansas but have nexus there, you would charge sales tax at the rate of your buyer’s ship-to location.
And if you live outside of Arkansas but have sales tax nexus in Arkansas, you would also charge sales tax at the local sales tax rate of the buyer’s ship-to address.
Should you collect sales tax on shipping charges in Arkansas?
Arkansas considers shipping charges that you charge the customer to be part of the taxable sale, and therefore if the item you are selling is taxable then the shipping charges are also taxable.
When are Arkansas sales tax returns due?
When you file and pay Arkansas sales tax depends on your assigned filing frequency and your state’s due dates.
How often will you file sales tax returns in Arkansas?
States assign you a filing frequency when you register for your sales tax permit. In most states, how often you file sales tax is based on the amount of sales tax you collect from buyers in the state.
In Arkansas, you will be required to file and remit sales tax either monthly, quarterly or annually.
Arkansas sales tax returns are always due the 20th of the month following the reporting period. If the filing due date falls on a weekend or holiday, sales tax is generally due the next business day.
Filing sales tax in Arkansas
When it’s time to file sales tax in Arkansas, follow these simple steps:
- Calculate how much sales tax you owe
- File a sales tax return
- Make a payment
How to calculate how much sales tax you owe in Arkansas
Calculating how much sales tax you should remit to the state of Arkansas is easy with TaxJar’s Arkansas sales tax report.
Connect the channels through which you sell – including Amazon, eBay, Shopify, Square, and more – we’ll calculate exactly how much sales tax you collected. All the information you need to file your Arkansas sales tax return will be waiting for you in TaxJar.
How to file and pay sales tax in Arkansas
You have three options for filing and paying your Arkansas sales tax:
- File online at the Arkansas Taxpayer Access Point (ATAP). You can remit your payment through their online system.
- File by mail – You can use Form ET-1 and file and pay through the mail. To file by mail, you must contact the Arkansas Department of Finance and Administration at 501-682-7104; they will mail you a form ET-1
- AutoFile – Let TaxJar file your sales tax for you. We take care of the payments, too. You’ll never have to worry about spreadsheets, calculations, or filling out complex sales tax returns.
