Indiana Sales Tax Guide for Businesses
- Sales Tax Rate
- Local Taxes
- Department of Revenue
- Tax Line
We wrote this guide for online sellers who want to know if they even have to bother with sales tax in Indiana, and if so, how best to tackle the sales tax situation in the Hoosier State.
After reading this, you’ll know:
- Do you or don’t you need to collect Indiana sales tax?
- Which customers do you collect from?
- How much do you collect?
- What do you do with all the sales tax you’ve collected?
- Way more than you probably ever wanted to know about Indiana sales tax!
Do you have sales tax nexus in Indiana?
Good news! You only have to begin thinking about Indiana sales tax if you have sales tax nexus in Indiana.
“Sales tax nexus” is just a fancy way of saying “significant presence” in a state.
Indiana considers a seller to have sales tax nexus in the state if you have any of the following in the state:
- Owned or leased tangible property
- An employee or independent sales representative in the state
- Indiana inventories
- Third parties that install, repair or service property that is sold to Indiana customers.
You can click here to read exactly what the Indiana Department of Revenue (Indiana’s taxing authority) has to say about what constitutes sales tax nexus in Indiana.
Do you have sales tax nexus in Indiana if you sell on FBA?
If you sell on Amazon FBA, you may have sales tax nexus in Indiana. Storing physical products in a state can create sales tax nexus, and Indiana is home to seven Amazon Fulfillment Centers.
To determine whether or not you have items stored in an FBA warehouse in Indiana, you can do one of two things:
- Login to Amazon Seller Central and pull your inventory report
- Sign up for a 30-day free trial of TaxJar and find out from where your Amazon inventory ships with our Amazon badge feature
You may find that your inventory is stored in one or all of Indiana’s Amazon fulfillment centers in this list:
|Warehouse Code||Address||County||Tax Rate|
|XUSE||5100 S Indianapolis Rd Whitestown, IN 46075||Boone||7%|
|IND1||4255 Anson Blvd. Whitestown, IN 46075||Boone||7%|
|IND2||715 Airtech Pkwy. Plainfield, IN 46168||Hendricks||7%|
|IND3||717 Airtech Pkwy. Plainfield, IN 46168||Hendricks||7%|
|IND4||710 South Girls School Rd Indianapolis, IN 46214||Marion||7%|
|IND5||800 S Perry Rd Plainfield, IN 46168||Hendricks||7%|
|SDF8||900 Patrol Rd. Jeffersonville, IN 47130||Clark||7%|
Is what you’re selling even taxable?
You’ve probably read this far because you realized you have sales tax nexus in Indiana. Your next step is to determine if what you’re selling is even taxable.
Services in Indiana are generally not taxable. So if you’re a masseuse or a lawyer, you’re in luck and you most likely don’t have to worry about sales tax. But watch out – if the service you provide includes fabrication, alteration or preparation of a product, you may have to deal with the sales tax on products.
Tangible products are taxable in Indiana , with a few exceptions. These exceptions include grocery items, items sold to farmers, and items sold to construction contractors.
So if you sell flowers, then charge sales tax to your Indiana customers.
But if you’re a gardener, don’t charge sales tax to your Indiana customers.
If you have sales tax nexus in Indiana and your products are taxable, your next step is to register for a sales tax permit.
How to Register for a Sales Tax Permit in Indiana
Sellers with sales tax nexus in Indiana must apply for an Indiana sales tax permit.
Don’t skip this step! Indiana considers it unlawful to collect sales tax in their name without a permit. Go here for more on how to register for a sales tax permit in Indiana.
How to Collect Sales Tax in Indiana
So you’ve determined that you have sales tax nexus in Indiana and what you’re selling is taxable. And you’re all set and registered for your Indiana sales tax permit(s).
The next step is to determine how much sales tax to collect.
Indiana has a statewide sales tax rate of 7% and no local sales taxes. So collecting sales tax in Indiana is easy - just collect 7%!
How to Collect Sales Tax in Indiana if You Sell on Amazon FBA
FBA sellers, like any sellers, collect 7% on sales to buyers in Indiana.
What are the Amazon sales tax settings for Indiana?
If you are an Amazon pro seller and use Amazon to collect sales tax, be sure you have your Indiana sales tax settings entered correctly. Find step-by-step instructions for setting up your Amazon sales tax settings here.
|If you are a…||State tax||County tax||City tax||District tax||Custom rate||Is shipping taxable?||Is gift wrapping taxable?|
|Seller living in Indiana||X||N/A||Yes||No|
|Seller living outside of Indiana||X||N/A||Yes||No|
Should you collect sales tax on shipping charges in Indiana?
If you ship taxable goods to buyers in Indiana, you are most likely required to charge sales tax on shipping charges.
Read a full explanation of sales tax on shipping in Indiana here.
When are Indiana Sales Tax Returns Due?
Indiana sales tax returns are always due the 20th of the month following the reporting period. You’ll be assigned a sales tax filing frequency when you apply for your Indiana sales tax permit.
To break it down:
2016 Indiana Monthly Sales Tax Filing Due Dates
|Taxable Period||Due Date|
|January||February 22, 2016*|
|February||March 21, 2016*|
|March||April 20, 2016|
|April||May 20, 2016|
|May||June 20, 2016|
|June||July 20, 2016|
|July||August 22, 2016*|
|August||September 20, 2016|
|September||October 20, 2016|
|October||November 21, 2016*|
|November||December 20, 2016|
|December||January 20, 2017|
*indicates a due date pushed back due to a weekend or holiday
2016 Indiana Quarterly Sales Tax Filing Due Dates
|Taxable Period||Due Date|
|Q1 (Jan - Mar)||April 20, 2016|
|Q2 (Apr - Jun)||July 20, 2016|
|Q3 (Jul - Sep)||October 20, 2016|
|Q4 (Oct - Dec)||January 20, 2017|
2016 Indiana Annual Sales Tax Filing Due Dates
|Taxable Period||Due Date|
|Year 2016||January 31, 2017|
|Year (Jul 2016 - Jun 2017)||July 31, 2017|
Click here for a chart of Indiana sales tax filing due dates for 2016 here.
How to File Sales Tax in Indiana
When it comes time to file sales tax in Indiana you must do three things:
- Calculate how much sales tax you owe
- File a sales tax return
- Make a payment
We’ll walk you through these steps.
How to Calculate How Much Sales Tax You Owe in Indiana
Calculating how much sales tax you should remit to the state of Indiana is easy with TaxJar’s Indiana 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 Indiana 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 Indiana
You have a couple options for filing and paying your Indiana sales tax:
- File online - File online at the Indiana Department of Revenue. You can remit your payment through their online system.
- 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.
Other Facts You Should Know about Indiana Sales Tax Filing
There are a few more things you should know about sales tax in Indiana:
- Failure to file or pay 10% of tax due
Other penalties for fraud or serial offenses include higher penalties and even criminal charges.
States understand that sales tax collection can be a burden and some even offer a small discount to merchants to file early or on time in order to alleviate some of that burden.
Indiana says that if total annual sales tax collected was less than $60,000, then you can claim a .083% discount. If total annual sales tax collected was between $60,000 and $600,000 then you can claim a 0.6% discount. And if total annual sales tax collected was more than $600,000 you can claim a 0.3% discount. Click here for more about state sales tax discounts.
And that’s it. You’ve mastered Indiana sales tax filing! Now that sales tax is out of the way, you can get back to what you do best – running your business.
Indiana Sales Tax Resources
For more about Indiana sales tax, check out the Indiana section of the TaxJar blog.