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I would like to ask what is a Sales Tax Licence, sometimes called Sales Tax Permit and how can I make an use of it as a non-US resident willing to begin business in USA. Is it a requirement in order to sell services on internet or is it only for physical goods ? Thanks

  • How did you hear about this license/permit? If you read about it on a government website, for example, please include a link to the page. Also, please edit your question to include the state(s) in which you want to sell. – dg99 Sep 26 '14 at 15:12
  • @dg99: If he's selling online, presumably he wants to sell to all the states. – Nate Eldredge Sep 26 '14 at 15:44
  • I wanted to sell in all USA + Canada, Hawaii excluded. I've learnt about this sales tax licence from a partnered distributor who said that he requires this licence in order to begin a b2b partnership with me. – Danny_Student Sep 26 '14 at 19:48
  • You say you're non-US resident, but that you're beginning business in the US. Are you physically in the US on a non-resident visa? – dpassage Sep 26 '14 at 21:04
  • No, I have a registered agent who transfers all gov mail to my physical adress in Europe. I incorporate with USA for 2 reasons. First - the conditions of my country's economy is tragic thus obligatory insurance fees and taxes are quite high to survive as a small business. Second - my target market is USA. – Danny_Student Sep 27 '14 at 0:32
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Sales tax permits come from the state in which your business is operating. You need a business license first for them to issue you one.

US sales taxes are collected by the business and remitted to the government, you need the permit in order to do this.

A bigger question is whether it's legal for you to engage in business in the first place. What is your visa status?

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  • I am currently incorporated in Wyoming. I have a Limited Liability Company founded there in order to pay no state income tax. – Danny_Student Sep 27 '14 at 0:33
  • @Danny_Student Then you need to obtain a sales tax license from Wyoming. Around here it's easy enough to do in person, I have no idea what it entails from the other side of the world, nor what the procedure is in Wyoming as I've never so much as set foot in the state. – Loren Pechtel Sep 27 '14 at 21:52
  • But do I need this licence if I'm running a service offering business ? When is this licence required exactly ? When you sell on bricks and mortar or even for physical goods sold over internet ? It's quite confusing as I want everything to be legit. – Danny_Student Sep 28 '14 at 13:29
  • @Danny_Student You need the license if you are going to do anything that involves goods that haven't already been subject to sales tax even if you don't collect any yourself. Locally that means even supplies consumed by your business. – Loren Pechtel Sep 28 '14 at 18:06
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    @Danny_Student just pointing out a common misconception. Incorporating in Wyoming has nothing to do with your taxes. At all. – littleadv Oct 26 '14 at 22:18
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Disclaimer: I am not a tax specialist

You probably need a sales tax permit if you're going to sell goods, since just about every state taxes goods, though some states have exemptions for various types of goods.

For services, it gets tricker. There is a database here that lists what services are taxed in what states; in Wyoming, for example, cellphone services and diaper services are taxed, while insurance services and barber services are not.

For selling over the internet, it gets even dicier. There's a guide on nolo.com that claims to be comprehensive; it states that the default rule of thumb is that if you have a physical presence in a state, such as a warehouse or a retail shop or an office, you must collect tax on sales in that state. Given your situation, you probably only need to collect sales tax on customers in Wyoming. Probably.

In any event, I'd advice having a chat with an accountant in Wyoming who can help walk you through what permits may or may not be needed.

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