Calculating Online Sales Tax for Your Small Business

If someone has a small business online and plans to sell products, some things need to be addressed regarding sales tax and sales tax solutions. Understanding how much sales tax a business owner needs to provide is based on the local tax rate, and if you have a physical tax that needs to be covered. This means where your inventory is, and your property for your business.

Video Source

Economic nexus is the other part of taxes that you need to pay.

This is newer, coming around in 2018, and can allow the states to tax remote sellers so that they have to pay into those states. States will want their cut of the state taxes because so many products were sold in that state. The thresholds are 200 transactions and $100,000. Once these have been checked, then you have to move forward with paying sales tax solutions in that particular state. These do start over each tax year. Start over every January to keep up with what you have to pay in for sales tax. In order to make sure you’re staying compliant with sales, you’ll need to track and monitor the data. A good practice to monitor for these thresholds is to check each quarter to see where you are and if you’re close to meeting them.