We encourage businesses to review the laws and rules of the Utah State Tax Commission to stay on top of which taxable and exempt goods are, and under what conditions. How you collect sales tax in Utah depends on how you sell your products: once you collect sales tax, you`ll need to remit it to the Utah State Tax Commission by a certain date. The tax commission then distributes them accordingly. The threshold in Utah is $100,000 in annual revenue or 200 separate sales transactions, depending on what your business makes first. To learn more about how this works, read the ultimate guide to the American economic bond. Now that you`ve registered your Utah seller`s license and know how to charge all your customers the right amount of sales tax, you`re ready to file your sales tax return. Make sure you meet all registration deadlines to avoid penalties and fines. If a deadline for VAT returns in Utah was missed due to circumstances beyond your control (e.g., weather, accident), the Tax Commission may grant you an extension. However, you may be asked to provide evidence to support your claim. As of January 1, 2019, Utah considers providers that have more than $100,000 in annual revenue or more than 200 transactions in the state in the previous or current calendar year to be economically connected. This means that the state considers these sellers to be required to collect sales tax from state buyers.
You can read Utah`s guidelines on economic ties for sellers here. VAT experts share their ideas and predictions for one of the U.S. Supreme Court`s most important sales tax decisions in decades, South Dakota v. Wayfair. The Simplified Sales and Use Tax Agreement (SSUTA) or Simplified Sales Tax (SST) is an attempt by several states to simplify the administration and cost of sales and use tax for distance sellers. Distance sellers can register in multiple states at the same time through the Simplified Sales Tax Registration System (SSTRS). If the answer to all three questions is yes, you will need to register with the state tax authority, collect the correct amount of sales tax per sale, file returns, and remit them to the state. Annual sales of $100,000 or 200 separate sales transactions It`s extremely important to set up point-of-sale tax collection – it`s almost impossible to collect sales tax from customers once the transaction is complete.
Now it`s time to tackle the complicated stuff! Tax rates may vary depending on the location of your business and customer, as well as the amount of sales tax applicable in those particular locations. The Utah Tax Commission assigns you a filing frequency. Typically, this is determined by the size or volume of your company`s sales, with larger companies filing more frequently. Small businesses can request a monthly deposit instead of an annual or quarterly deposit. For more information, see Registration deadlines. On the 27th. The Marketplace Fairness Act of 2017, introduced in April 2017, would allow states that meet certain requirements to require distance sellers who do not have a small seller exemption to collect their state and local sales and use taxes. One final tricky aspect of sales tax in Utah is sales tax holidays.
On these days of the year, you don`t have to charge sales tax and buyers don`t expect any fees to be charged. Check the state`s website for current sales tax exemptions. When you file and pay sales tax in Utah depends on two things: the filing frequency assigned to you and your state`s due date. Utah requires businesses to file sales tax returns and file sales tax payments online. However, as of October 2019, there are no sales tax holidays in Utah. Utah businesses are only required to pay sales tax on out-of-state sales if they have a connection in other states. Nexus means that the company has a physical presence in another state. Effective January 29, 2020, Utah enacted legislation repealing previously passed laws, S.B. 2001, which included extending tax liability to certain services, eliminating sales tax exemptions, creating new sales tax exemptions, etc.
The next critical step to VAT compliance in Utah is to register for a sales tax permit. It is actually illegal to levy taxes without a permit. So, to get all your ducks online, start with tax registration. When calculating sales tax, you should consider the following types of sales: The VAT link in all states was previously limited to physical presence: A state could require a business to register, collect, and remit sales tax if it had a physical presence in the state, such as employees or an office. Retail store or warehouse. Key information such as deadlines, thresholds, and inclusive sales for out-of-state sellers who make sales in states that enacted economic ties laws before and after the South Dakota Supreme Court`s decision against Wayfair. When you sign up for sales tax, Utah assigns you a specific enrollment frequency. You will be asked to file and pay sales tax monthly, quarterly or annually. Calculating the amount of sales tax you have to remit to the state of Utah is easy with TaxJar`s Utah sales tax report.
If you have more than one location in Utah, calculate the sales tax rate at which the sale occurred.