New York Sales Tax Guide for Businesses
- Sales Tax Rate
- Local Taxes
- Department of Taxation and Finance
- Tax Line
We wrote this guide for online sellers who want to know if they even have to bother with sales tax in New York, and if so, how best to tackle the sales tax situation in the Empire State.
After reading this, you’ll know:
- Do you or don’t you need to collect New York 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 New York sales tax
Do you Have Sales Tax Nexus in New York?
Good news! You only have to begin thinking about New York sales tax if you have sales tax nexus in New York.
“Sales tax nexus” is just a fancy way of saying “significant presence” in a state.
New York considers a seller to have sales tax nexus in the state if you have any of the following in the state:
- An office or place of business
- An employee present in the state for more than 2 days per year
- Goods in a warehouse
- Ownership of real or personal property
- Delivery of merchandise in New York in vehicles owned by the taxpayer
- Independent contractors or other representatives in New York
Do you have sales tax nexus in New York if you sell on FBA?
Selling on FBA does not create sales tax nexus in New York. Storing physical products in a state can create sales tax nexus, and New York does not (yet) have any Amazon Fulfillment Centers.
Is What You’re Selling Even Taxable?
You’ve probably read this far because you realized you have sales tax nexus in New York. Your next step is to determine if what you’re selling is even taxable.
Certain services in New York are considered taxable. If your business includes performing repair and maintenance services to real property, you are required to register for sales tax. This includes services such as: lawn mowing, interior or exterior painting of an existing house or structure, snow removal services, plumbing repairs, electrical repairs, and swimming pool maintenance.
Tangible products are taxable in New York, with a few exceptions. These exceptions include certain groceries and food items, over-the-counter and prescription medicine, family planning products, medical devices, and certain clothing and footwear sold for less than $110 per item. Also, tax exempt are medical devices, certain machinery and chemicals used in research and development.
So, if you sell a product like empty jam jars, then charge sales tax to your New York customers. But if you’re an artisanal jam-maker, neither your service, nor your product would be subject to sales tax to your New York customers.
If you have sales tax nexus in New York 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 New York
Sellers with sales tax nexus in New York must apply for a New York sales tax permit, which in New York is called a Certificate of Authority.
How to Collect Sales Tax in New York
So you’ve determined that you have sales tax nexus in New York and what you’re selling is taxable. And you’re all set and registered for your New York sales tax permit(s).
The next step is to determine how much sales tax to collect.
The sales tax rate you collect in New York depends on exactly where in New York your buyer is located.
How to Collect Sales Tax in New York if You are Based in New York
New York is a destination-based sales tax state. So if you live in New York, collecting sales tax can be a bit complicated. You should be charging everyone in your state the rate where the item is being delivered. That could include a combination of state, county, city, and district tax rates.
Example: You live and run your business in Schenectady, NY, but sell to a buyer in Buffalo, NY, in the 14201 zip code. The sales tax rate in Buffalo is made up of the 4.0% New York sales tax rate, plus the 4.75% Erie County rate for a total of 8.75%. You would charge each of your New York customers the total sales tax rate for their location.
How to Collect Sales Tax in New York if you are Not Based in New York
New York wants sellers who made a sale into New York from outside the state to charge sales tax based on the destination of the buyer.
Example: You live in Colorado, but have sales tax nexus in New York due to having attended multiple trade shows in the state, over the course of a year. If you make a sale to a buyer in Yonkers, New York (10701 zip code) then you would charge sales tax based on the sales tax rate in the buyer’s location, Yonkers.
Should you collect sales tax on shipping charges in New York?
In New York, if you are selling taxable goods, and charge for shipping as part of an order, then it’s taxable. It doesn’t matter if the shipping charge is part of the price of the item or if it’s listed separately from the price of the item.
If the goods you are selling aren’t taxable, then neither is your shipping.
|1||New York||8,244,910||Bronx, Kings, New York, Queens, and Richmond||8.88%|
When are New York Sales Tax Returns Due?
Your sales tax returns are due on the 20th of the month following the taxable month. For example, your April sales tax return would be due May 20th
2016 New York 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|
2016 New York Quarterly Sales Tax Filing Due Dates
|Taxable Period||Due Date|
|Q1 (Jan - Mar)||March 21, 2016*|
|Q2 (Apr - Jun)||June 20, 2016|
|Q3 (Jul - Sep)||September 20, 2016|
|Q4 (Oct - Dec)||December 20, 2016|
2016 New York Annual Sales Tax Filing Due Dates
|Taxable Period||Due Date|
|Year (Mar 2016 - Mar 2017)||March 21, 2017*|
*indicates a due date pushed back due to a weekend or holiday
How to File Sales Tax in New York
When it comes time to file sales tax in New York 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 New York
Calculating how much sales tax you should remit to the state of New York is easy with TaxJar’s New York 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 New York 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 New York
The state of New York requires you to do all sales tax filing and payment remittance online. You can do one of two things:
- File online at the New York Department of Taxation and Finance. You must also remit your payment through their online system.
- AutoFile with TaxJar - 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 New York Sales Tax Filing
There are a few more things you should know about sales tax in New York:
- Late Filing Penalty - The minimum penalty is $50, and interest at a rate that increases as time passes. Further information can be found, here.
Other penalties for fraud or serial offenses include higher penalties and even criminal charges and imprisonment.
New York requires that any seller with a sales tax permit file a sales tax return on your due date even if you don’t have any sales tax to report or pay, at minimum, a late penalty of $50.
Many states understand that collecting sales tax is a difficult burden on merchants, and will provide a discount to help alleviate some of this burden. In New York, as long as the sales tax is paid on time, a discount is available equal to 5% of sales tax due and is not to exceed $200 per quarter, or longer period.
And that’s it. You’ve mastered New York sales tax filing! Now that sales tax is out of the way, you can get back to what you do best – running your business.
New York Sales Tax Resources
For more about New York sales tax, check out the New York section of the TaxJar blog.