Navigating Pennsylvania’s sales tax guidelines
Online vendors and businesses must understand the context of Pennsylvania’s sales tax laws if they make sales in the state. Pennsylvania requires businesses that have met an economic sales threshold or that have a physical presence in the state to collect sales tax on every sale. Learn about Pennsylvania’s economic nexus sales thresholds to determine if your business has tax obligations in the state, and use TaxJar’s sales tax calculator to estimate potential sales tax liabilities.
Do you need to collect sales tax in Pennsylvania?
Businesses l need to collect sales tax in Pennsylvania if they have either physical or economic nexus. A business is determined to have a physical nexus in the state when it has a tangible presence or activity in Pennsylvania. A business or online seller has economic nexus when it has met Pennsylvania’s economic threshold for total revenue or the number of sales transactions.
Do you have physical nexus in Pennsylvania?
Pennsylvania considers a seller to have physical nexus if the business has:
- An office or place of business in Pennsylvania
- An employee present in the state
- Goods in a warehouse
- Ownership of real or personal property
- Delivery of merchandise in Pennsylvania
- Independent contractors or other representatives in Pennsylvania
- Leasing property in the state
The Pennsylvania Department of Revenue provides additional clarity about what constitutes sales tax nexus in Pennsylvania.
Do you have economic nexus in Pennsylvania?
Effective July 1, 2019, sales into Pennsylvania that exceeded $100,000 in the previous 12-month period are considered to have economic nexus. The notice and report is still in effect for those with taxable sales greater than $10,000 but less than $100,000 in a calendar year. Online sellers can review Pennsylvania’s economic nexus guidance for sellers.
According to Pennsylvania, sellers who meet the nexus threshold are required to register for a Pennsylvania sales tax permit, collect sales tax on sales that ship into Pennsylvania, and remit sales tax to the state.
Those who do not meet the economic threshold should make an election by March 1 of every year and do one of two things:
- Register for a Pennsylvania sales tax permit, collect sales tax on sales that ship into Pennsylvania, and remit sales tax to the state.
- Comply with the state’s rigorous “notice and reporting requirements.”
Pennsylvania’s economic nexus law (and notice and reporting requirements) is published online.
Effective date: 7/1/2019 for economic nexus threshold
What is the Pennsylvania state sales tax rate?
The Pennsylvania state sales tax rate is 6%. Local sales tax rates may apply.
Is what you’re selling taxable?
Services in Pennsylvania are generally not taxable, with a few exceptions.
Tangible products are taxable in Pennsylvania, with a few exceptions. These exceptions include food (not ready-to-eat); candy and gum; most clothing; textbooks; computer services; pharmaceutical drugs; sales for resale; and residential heating fuels such as oil, electricity, gas, coal and firewood.
Is SaaS taxable in Pennsylvania?
SaaS is taxable in Pennsylvania.
How to get a sales tax permit in Pennsylvania
Pennsylvania offers an online option to register for most licenses and other business registrations.
Online sellers and businesses can also visit TaxJar’s registration page to request for TaxJar to manage your Pennsylvania registration.
Businesses also can download and print out the PA-100 and send it to:
Commonwealth of PA
Department of Revenue
Bureau of Business Trust Fund Taxes
PO Box 280901
Harrisburg, PA 17128-0901
717-787-1064
All businesses must provide the following information to register for a sales tax permit in Pennsylvania:
- Enterprise Information (name, date of operations, etc.)
- Taxes you’re applying for
- Business structure
- Owners/Partners/Shareholders etc. information
- Business activity information
- Transient vendor certificate, if applicable
- Promoter license, if applicable
Pennsylvania does not charge a fee for a sales tax permit. Other business registration fees may apply. Contact each state’s individual department of revenue for more about registering your business.
Collecting sales tax
The sales tax rate you collect in Pennsylvania depends on whether you are based in Pennsylvania or out of state.
How to collect sales tax if you are based in Pennsylvania
Pennsylvania is an origin-based sales tax state. If you live in Pennsylvania,collect sales tax at the tax rate where your business is located.
You can research your local sales tax rate with TaxJar’s Sales Tax Calculator.
If you have more than one location in Pennsylvania, then you would base the sales tax rate you charge on the point of origin of your sale.
Only two locations in Pennsylvania have a local tax rate: Allegheny County and Philadelphia. (For more information on specific business taxes applicable to merchants located in or operating in Philadelphia, contact the City of Philadelphia All other counties and cities use the state sales tax rate of 6%.
If you have more than one location in Pennsylvania, then you would base the sales tax rate you charge on the point of origin of your sale.
How to collect sales tax if you are not based in Pennsylvania
If you live outside of Pennsylvania but have nexus in the state, charge the 6% Pennsylvania state use tax rate. (Use tax is similar to sales tax, but it is assessed only by “remote sellers” – sellers who aren’t based in a state but have sales tax nexus in that state.)
Should you collect sales tax on shipping charges in Pennsylvania?
If the item being shipped is taxable, the shipping and handling charges are also subject to tax. If the item being shipped is not subject to sales tax, then the shipping and handling charges are not taxed either. When items that are being shipped are both taxable and nontaxable, then the shipping and handling charges for the entire shipment are subject to tax.TaxJar offers additional insights about sales tax on shipping in Pennsylvania.
When are returns due?
When you file and pay Pennsylvania sales tax depends on your assigned filing frequency and your state’s due dates.
How often will you file sales tax returns in Pennsylvania?
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 Pennsylvania, your sales tax filing frequency is determined by your sales tax liability during Q3 of the previous year.
In Pennsylvania, you will be required to file and remit sales tax either monthly, quarterly, or semiannually. Pennsylvania sales tax returns are generally always due the 20th of the month following the reporting period, though semi-annual filers get an extra month. If the filing due date falls on a weekend or holiday, sales tax is generally due the next business day.
Filing sales tax
There are three simple steps when it’s time to file sales tax in Pennsylvania:
- 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 Pennsylvania
Calculating how much sales tax you should remit to the state of Pennsylvania is easy with TaxJar’s Pennsylvania sales tax report. 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 Pennsylvania sales tax return will be waiting for you in TaxJar.
How to file and pay sales tax in Pennsylvania
You have three options for filing and paying your Pennsylvania sales tax:
- File online at the Pennsylvania Department of Revenue. You can remit your payment through their online system.
- File over the telephone- 1-800-748-8299
- 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.
