2024 Guide to Sales Tax in New York City, New York

What is the Sales Tax in New York City?

New York City has a combined sales tax rate of 8.875%. In New York, the sales tax rate can be made up of three different sales tax rates:

• The New York state sales tax rate: 4.0%
• New York City sales tax rate: 4.875%
• Special sales tax rates: 0%

What is New York County Sales Tax?

New York County’s sales tax rate is 0%, but it is part of the combined rate for New York City. Additional special tax rates may apply for certain goods and services.

Tax Rates in New York City, New York

Wondering how much sales tax rates vary in New York City? Here’s a list of the top 10 zip codes in New York City and the sales tax rates they charge by zip code.

Other Tax Rates for New York

We’ve now shared the main tax rates for New York City. Here are some other tax rates that you might have to charge in that city and state.

What Items are Taxable in New York City?

In New York, not all items are taxable. For example, in many states, prescription drugs are exempt from sales tax. The best way to ensure you’re charging taxes on the right items is to add a Tax Information Code (TIC) to all the items you’re selling so that the correct tax is charged. A TIC is a number assigned to a category of goods or services.

Here is a list of some of the things that are taxable in New York City:

What Items are Exempt from Taxes in New York City?

In New York, there are several items that are exempt from taxes. States typically make items tax-exempt to encourage their purchase or because the items are essentials.

The easiest way to make sure you don’t accidentally charge sales tax on an item that’s exempt is to add a Tax Information Code (TIC) to all your items. A TIC is a number that groups similar goods or services into one category.

Here is a list of some of the things that are tax-exempt in New York City:

Who Needs to Collect Sales Tax in New York City?

A business only needs to collect sales tax in New York City if they have either achieved physical nexus or economic sales tax nexus in New York.

Physical Nexus in New York

Physical nexus in New York means that your business has a physical presence of some kind in the state. This includes having headquarters, a satellite office, a warehouse, a distribution center, a showroom, or any other form of physical location. Having affiliates, employees, or rented/leased property in New York can also establish physical nexus.

Economic Nexus in New York

Even without a physical presence, businesses can establish economic nexus in New York by making a certain amount of sales to residents of New York. The threshold is $500,000 in sales in a year and more than 100 sales transactions.

How to Get a Sales Tax Permit in New York City

If you reach either physical or economic nexus, you’ll need to get a sales tax permit in New York. Getting your sales tax permit is easy and free. Here are the steps:

1. Go to the New York State Department of Taxation and Finance website.
2. Answer a few questions about your business.
3. Allow the wizard to identify what permits you need and register you for them.

How to Charge the Right Amount of Sales Tax in New York City

To ensure you charge the correct sales tax rate in New York City:

• Manually check and input rates: Check the state’s website for updates on sales tax rates.
• Use a sales tax compliant software solution:

Automate sales tax management with software like TaxCloud.

How to File and Remit Sales Tax in New York City

If you have sales tax nexus in New York, you can collect sales taxes from across the state and file just one state-wide return. The New York State Department of Taxation and Finance will then remit those funds to the appropriate city, district, or county.

By following these guidelines, you can ensure that you remain compliant with New York City’s sales tax regulations, helping you avoid penalties and focus on growing your business. For more detailed information, refer to the New York State Department of Taxation and Finance website.

This content page should help businesses understand the sales tax requirements in New York City, ensuring they remain compliant and efficient in their tax collection and remittance processes.