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Learn the fundamentals of sales tax
Do you need to collect sales tax in Oklahoma?
You’ll need to collect sales tax in Oklahoma 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 Oklahoma?
Oklahoma considers a seller to have physical nexus if you have any of the following in the state:
- An office or place of business
- A salesperson, contractor, installer or other representative of the business doing business in the state
- Goods in a warehouse, distribution center or other place of business
- Delivery of merchandise in Oklahoma in vehicles owned by the taxpayer
You can click here to read exactly what the Oklahoma Tax Commission has to say about what constitutes sales tax nexus in Oklahoma (page 8 – “Place of Business.”)
In 2016, Oklahoma passed a law attempting to declare that some out-of-state sellers with no significant presence in the state also have Oklahoma sales tax nexus. You can read more about the Oklahoma Retail Protection Act of 2016 here.
Do you have economic nexus in Oklahoma?
Effective November 1, 2019, Oklahoma considers vendors who sell at least $100,000 in the previous 12 months in the state to have economic nexus. This means the state considers these vendors obligated to collect sales tax from buyers in the state. You can read Oklahoma’s economic nexus guidance for sellers here.
Is what you’re selling taxable?
Services in Oklahoma are generally not taxable. However – if the service you provide includes creating or manufacturing a product for sale, you may have to deal with the sales tax on products.
Tangible products are taxable in Oklahoma, though a few products have an exemption, such as certain prescription medications. There is also an exemption for medical equipment and supplies.
Is SaaS taxable in Oklahoma?
SaaS is non-taxable in Oklahoma. (Source)
How to get a sales tax permit in Oklahoma
You can also register in person at the Oklahoma City or Tulsa offices of the Oklahoma Tax Commission.
You need this information to register for a sales tax permit in Oklahoma:
- Personal identification information (Name, address, SSN, etc.)
- Business identification information (Name, address, EIN, etc.)
- Business entity type
- Date of incorporation (if applicable)
- Types of products sold
It costs $20 to apply for an Oklahoma sales tax permit. There’s also a convenience fee of $3.95 for paying with a Visa Debit card and a convenience fee of 2.5% for paying with any other type of card. Other business registration fees may apply, too.
Collecting Sales Tax
The Oklahoma state sales tax rate is 4.5%. If you are based in Oklahoma and selling to a buyer with a ship to address in Oklahoma, charge sales tax based on the sales tax rate at the ship to address.
If you are not based in Oklahoma, but have sales tax nexus in Oklahoma you are considered an Oklahoma “remote seller.” This is where things get tricker, since remote sellers are required to collect “use tax,” which is similar to sales tax, but can vary slightly from Oklahoma sales tax rates.
You can look up your local sales tax rate with TaxJar’s Sales Tax Calculator.
Should you collect sales tax on shipping charges in Oklahoma?
As long as you separately state the shipping charges on your bill to your customer, you do not have to charge sales tax on shipping.
But if you include shipping in the price of the product you sell the customer, then shipping is considered part of the taxable transaction and Oklahoma declares that you must collect sales tax on shipping.
Read a full explanation of sales tax on shipping in Oklahoma here.
When are Returns Due?
When you file and pay Oklahoma sales tax depends on two things: your assigned filing frequency and your state’s due dates.
How often will you file sales tax returns in Oklahoma?
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 Oklahoma, you will be required to file and remit sales tax either monthly or semiannually.
Oklahoma 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
When it comes time to file sales tax in Oklahoma 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 Oklahoma
Calculating how much sales tax you should remit to the state of Oklahoma is easy with TaxJar’s Oklahoma 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 Oklahoma 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 Oklahoma
You have three options for filing and paying your Oklahoma sales tax:
- File online – File online at OK Tap. You can remit your payment through their online system.
- File by mail – You can use form STS-20002 to file on paper and by mail. Keep in mind that filers who pay more than $2500 per month are required by Oklahoma to file online.
- 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.