Do you need to collect sales tax in Vermont?
You’ll need to collect sales tax in Vermont 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 Vermont?
Vermont considers a seller to have physical nexus if you have any of the following in the state:
- Physical presence, retail store, warehouse, inventory or employees located in Vermont
Here’s exactly what Vermont has to say about sales tax nexus (subheading 9).
Do you have economic nexus in Vermont?
Effective July 1, 2018, Vermont considers vendors who make more than $100,000 in sales annually in the state or more than 200 transactions during any preceding twelve-month period 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 Vermont’s economic nexus guidance for sellers here.
Is what you’re selling even taxable?
Certain services are taxable. Check the Vermont Department of Revenue to see if your service is taxable.
Tangible personal property is generally taxable in Vermont. There are some exemptions such as certain clothing items, medical supplies, prescription drugs and groceries. Check the Vermont Department of Revenue to see if your product is taxable.
Is SaaS taxable in Vermont?
SaaS is non-taxable in Vermont as of July 1, 2015. (Source)
How to get a sales tax permit in Vermont
If you are located in Vermont, you should first register for a business tax account at the Vermont Department of Taxes. From there, you can register for your sales tax account.
If you are not based in Vermont but have economic nexus in Vermont, we recommend contacting the Vermont Department of Taxes before registering. You can find their most updated date phone number here.
Though Vermont strongly encourages merchants to register online, you can also use form BR-400 to register by mail or fax (802-828-5787).
You’ll need this information to register for a sales tax permit in Vermont:
- Personal identification info (SSN, address, etc.)
- Business identification info (EIN, address, etc.)
- NAICS Code
It’s free to apply for a Vermont sales tax permit, but other Vermont business registration fees may apply.
Collecting Sales Tax
Vermont is a destination-based sales tax state. Meaning you should be charging everyone in your state the rate where the item is being delivered. Vermont state does have local sales tax, so the total sales tax rate could include a combination of state, county, city, jurisdictions, and district tax rates. The state sales tax rate in Vermont is 6%.
Check your local Vermont sales tax rates using the TaxJar sales tax calculator.
Should you collect sales tax on shipping charges in Vermont?
Delivery charges are considered part of the sale and are therefore taxable if the sale is taxable. If you happen to be selling a non-taxable item, then delivery charges are also not taxable. Vermont is a fairly straightforward state when it comes to shipping taxability.
When are Returns Due?
When you file and pay Vermont 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 Vermont?
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 Vermont, you will be required to file and remit sales tax either monthly, quarterly, or annually.
Vermont sales tax returns are generally always due the 25th day 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 Vermont 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 Vermont
Calculating how much sales tax you should remit to the state of Vermont is easy with TaxJar’s Vermont 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 Vermont 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 Vermont
You have three options for filing and paying your Vermont state sales tax:
- Pay online using myVTax portal.
- Send in a payment via mail to: Vermont Department of Taxes PO Box 1779, Montpelier, VT 05601-1779
- 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.