What is New York Sales Tax for Amazon Sellers?

Last Updated:
July 27, 2018

It is more important than ever for e-commerce sellers to understand whether they may be affected by certain states sales taxes. In particular, New York State is known to have strict rules on conducting proper registration and filings for sales tax.

In to determine whether NYS Sales Tax is applicable to you, as an amazon seller, you must first determine whether you have a "nexus" in New York. Nexus, is the determining factor of whether an out-of-state business selling products into a state is liable for collecting sales or use tax on sales into the state.

NYS Sales Tax Rates by County for Amazon Sellers

Do you have a sales tax nexus in New York?

Sales Tax Nexus

Another way of saying "Sales Tax Nexus" is having  “significant presence” in a particular state.

An Amazon Seller is considered to have a Sales Tax Nexus in NYS if they have any of the following in New York: 

  • An office or place of business;
  • An employee present in the state for more than 2 days per year;
  • Goods in a warehouse;
  • Ownership of real or personal property;
  • Delivery of merchandise in New York in vehicles owned by the taxpayer; or
  • Independent contractors or other representatives in New York.

The New York Department of Taxation and Finance (New York’s taxing authority) defines what constitutes Sales Tax Nexus here. 

Registration for a sales tax permit in New York

NYS Sales Tax Filing

Before making taxable sales, a vendor is required to register and get a Certificate of Authority from the tax department of New York. Vendors/Sellers can apply online through the NYS License Center. They must register/apply at least 20 days before they operate their business in the state

Collecting sales tax in the State of New York

The point of delivery determines the rate of the sales tax to be applied per transaction. The rate of the tax to be charged is the total of the tax rate in effect in the state where the delivery occurs, plus the local tax rate, and district/transportation rate if applicable. On certain exempt purchases (ex. Purchaser provided an exemption certificate within 90 days of the purchase), collecting sales tax is not required.

Filing sales tax returns in New York

When you register as a vendor in the State of New York, you will be classified as a quarterly filer unless you meet the specific conditions for monthly or annual filing. Your sales tax payments and returns will be due on or before the 20th of the month following the reporting period.

Importantly, vendors in the State of New York must keep their detailed records of all their sales for at least three years from the due date of the return or the date when the return is filed-- whichever is later. Significant penalties may be imposed by the State for insufficient records.

All vendors in the State of New York are required to complete all sales tax filing online at the State’s Department of Taxation and Finance website.

Important Note for Vendors:

New York is serious about sales tax evasion issues within its borders. Penalties and interests that are as high as 14.5% may be charged for late payment of sales tax. The vendor’s Certificate of Authority could be revoked or might even face criminal prosecution.

If you, as a vendor, receive a notice from the State of New York Tax Department advising you of your outstanding tax liabilities, they may pursue collection or even enforce income execution to collect what you owe.

The State offers a Voluntary Disclosure and Compliance Program for vendors. Eligible vendors with a noncompliance history who voluntarily disclose and pay their outstanding liabilities will not be imposed with penalties or criminal charges. Qualified taxpayers are even eligible for a limited look-back period.

To sum it all up, vendors of taxable properties and services in the State of New York must apply for a Certificate of Authority, collect sales tax and remit the taxes, and regularly file returns to avoid penalties or criminal charges.

 

Are you an Amazon Marketplace Seller? If so check out taxomatetaxomate is an automated cloud-based service used by Amazon merchants to import their Amazon sales and fee transactions and to post summarized transactions to Xero or QuickBooks accounting systems. 

 

Are you an Amazon Seller?

Check out taxomate for QuickBooks and Xero!

Explore taxomate