As an e-commerce seller, you will need to collect sales tax in New York if you have:
(1) gross receipts exceeding $500,000 and more than 100 sales delivered in the state for the immediate preceding four sales tax quarters (economic nexus) or,
(2) Physical presence in New York (physical nexus).
Below, we will highlight some of the basic provisions of New York sales tax law.
What is the tax rate range for New York?
State: New York’s general sales tax rate is 4%.
Local: Local jurisdictions can range from 0% to 4.875%.
Do you have physical or economic nexus in New York?
Physical nexus. Certain business activities create physical nexus in New York. If you have physical nexus, you are required to collect and remit sales tax on all taxable sales that are shipped to New York. Examples of business activities that can create physical nexus in New York include:
- Owning an office or place of business in New York
- Having employees in New York
- Having goods or inventory in New York
- Owning other tangible personal property in New York
- Delivering merchandise into New York in taxpayer-owned vehicles
Economic nexus. New York recognizes economic nexus for any vendor with gross receipts from sales of tangible personal property delivered into New York exceeding $500,000 and more than 100 sales of tangible personal property delivered into New York in the previous four quarters.
- Sales of both taxable and exempt property must be included
- Sales you make through a marketplace are also included in calculating the thresholds
- Once you have established economic nexus, you will be obligated to register within 30 days and collect sales tax from buyers in New York 20 days thereafter.
What are examples of sales of taxable items?
- Tangible personal property, unless an exemption applies
- Information services, telecommunications, and various other services
- Software as a Service (SaaS)
What are examples of sales of nontaxable/exempt items?
- Services are generally exempt, unless specifically taxable
- Certain groceries (taxable and exempt foods/beverages list)
- Over-the-counter and prescription drugs and medicines (TB ST-193)
- Medical equipment and supplies, unless sold for use in providing medical or similar services for compensation (Pub 822)
- Certain clothing and footwear less than $110 per item (may be subject to local taxes)
- Property or services used in farming and horse boarding (ST-244)
Are there any sales tax holidays?
New York does not currently recognize any annual sales tax holidays.
Is New York a member of the SST (Streamlined Sales Tax)?
Currently, New York is not a full or associate member of the Streamlined Sales Tax Governing Board (SSTGB).
How to get a sales tax permit / links to register in this state?
You can register online at: New York State Sales Tax Registration Page