Do you need to collect sales tax in Alaska?
You’ll need to collect sales tax in Alaska if you have nexus there. There are two ways that sellers can be tied to a state when it comes to nexus: physical or economic. Physical nexus means having enough tangible presence or activity in a state to merit paying sales tax in that state. Economic nexus means passing a states’ economic threshold for total revenue or the number of transactions in that state.
Do you have physical nexus in Alaska?
If you live in Alaska, you’re in luck. Alaska does not have a state-wide sales tax!
Instead, the state recently passed legislation allowing local jurisdictions to elect to require that e-commerce businesses with economic nexus to collect sales tax. You can find a list of local jurisdictions that require sellers with economic nexus in Alaska to collect here.
Read the text of Alaska’s Remote Seller Sales Tax Code (ARSSTC) here. Once a jurisdiction has adopted the code, online businesses with economic nexus in Alaska have 30 days to begin collecting sales tax from buyers in participating jurisdictions.
If you have physical presence (such as an office, store or employee) in Alaska and your business is physically located in a jurisdiction that has adopted the Alaska Code, then you are required to collect and remit sales tax.
If you have a physical presence in Alaska that creates nexus and your physical nexus is not in a local jurisdiction that’s adopted the code, you do not need to collect and remit sales tax.
Further, if you have a physical presence in Alaska which is not in a local jurisdiction that’s adopted the code, you can be considered a “remote seller” if you sell into those local jurisdictions that have adopted the code.
Do you have economic nexus in Alaska?
Alaska’s economic nexus law is a little different than other economic nexus laws. The Alaska Remote Seller Sales Tax Code was passed on January 6, 2020. However, from there local jurisdictions decide whether to adopt the code. And once a local jurisdiction has adopted the code, businesses have 30 days to begin collecting sales tax from Alaska buyers located in that jurisdiction. Here is a list of the current participating Alaska jurisdictions.
The Code requires remote sellers and marketplace facilitators to register with the commission and collect and remit the tax on their sales into member Alaska localities if the sellers or facilitators have $100,000 or more in annual gross receipts from sales, or 200 or more sales annually into the state. Full text: Read Alaska’s remote seller sales tax code here.
If you have reached Alaska’s economic nexus threshold, you will be required to collect and remit sales tax in all of the jurisdictions that have adopted the Code.
What is taxable in Alaska?
While the state of Alaska does not have a state-wide sales tax, cities and boroughs in Alaska can require a local sales tax. Exemptions (or non-taxable items) are considered a local issue, and the Alaska Department of Commerce, Community and Economic Development recommends you contact the municipality directly for information on what is taxable.
How to get a sales tax permit in Alaska
Businesses with physical locations in Alaska should consult with the Alaska Department of Revenue – Tax Division.
Remote sellers who exceed the Alaska economic nexus threshold can register online at the Alaska Remote Sellers Sales Tax Commission (ARSSTC) portal.
Remote sellers do not have to register with individual jurisdictions. Registering at the ARSSTC portal will cover all jurisdictions.
What information do you need to register for a sales tax permit in Alaska?
Identifying information about your business including:
- Business name
- Phone Number and
- Employer Identification Number (EIN)
There is no cost to apply for a sales tax permit through the ARRSTC portal.
How to Collect Sales Tax in Alaska
Since Alaska does not have a state-wide sales tax rate – for sellers with sales tax nexus, you’ll need to check local jurisdictions within Alaska to determine if and how much sales tax to charge.
The good news, the TaxJar API supports sales tax calculations in applicable local jurisdictions within Alaska. We continuously update our API as new Alaska jurisdictions require sales tax or as sales tax rates update and change. Collect the right sales tax rate from the right customer every time.
When are Returns Due?
When you file and pay sales tax in Alaska depends on the specific jurisdiction. You will be subject to the due dates set by individual jurisdictions.
Filing Sales Tax
When it comes time to file sales tax in Alaska you must do three things:
- 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 Alaska
Calculating how much sales tax you should remit in Alaska is easy with TaxJar’s Alaska state sales tax report.
All you do is connect the channels through which you sell – including Amazon, eBay, Shopify, Square and more – and we’ll calculate exactly how much sales tax you collected. All the information you need to file your local Alaska sales tax return will be waiting for you in TaxJar. All you have to do is login!
How to File and Pay Sales Tax in Alaska
File online at the Alaska Remote Seller Sales Tax Commision. You can remit your payment through their online system.