Internet sales tax is now becoming a very important part of an online retail business, but that hasn't always been the case. Back in the old days of ecommerce, customers and retailers were both able to enjoy freedom from paying this tax. Regulations were almost nonexistent at the time and online shoppers grew accustomed to not having to pay website sales tax. As a result, e-commerce businesses have gotten an edge over their offline counterparts.
Unfortunately the free ride is almost over. Several states are starting to crack down and demand payback for the loss of billions of dollars worth of tax revenue over the past few years. Retailers without a web presence are also arguing that online retailers have an unfair advantage, because they don't have to charge the same tax. Both parties are calling for a new national internet sales tax to be set up.
For now, the majority of states only require online retailers to collect internet sales tax from consumers who reside in the same state as the actual location of their business. Some states have tighter regulations and take into consideration merchant account, distributor, warehouse, drop shipper and sales representative locations as well. It is important to go over the tax regulations of all the states with any kind of link to your business. If you do not pay the applicable taxes, there will be consequences that could significantly hurt your business. Not only will you have to pay back the amount owed, you will also be fined interest and penalties for each year that you did not pay.
Here is a checklist to help you get started:
Unfortunately the free ride is almost over. Several states are starting to crack down and demand payback for the loss of billions of dollars worth of tax revenue over the past few years. Retailers without a web presence are also arguing that online retailers have an unfair advantage, because they don't have to charge the same tax. Both parties are calling for a new national internet sales tax to be set up.
For now, the majority of states only require online retailers to collect internet sales tax from consumers who reside in the same state as the actual location of their business. Some states have tighter regulations and take into consideration merchant account, distributor, warehouse, drop shipper and sales representative locations as well. It is important to go over the tax regulations of all the states with any kind of link to your business. If you do not pay the applicable taxes, there will be consequences that could significantly hurt your business. Not only will you have to pay back the amount owed, you will also be fined interest and penalties for each year that you did not pay.
Here is a checklist to help you get started:
- Review the regulations of each state that your business has any kind of involvement in and figure out whether or not you have to collect internet sales tax from consumers of that state
- Register to collect taxes in the state or states where applicable
- Automatically collect website sales tax using a good e-commerce/shopping cart solution
- File a tax return to the appropriate state(s) and remit all of the proceeds with your return
- Easy to use website sales tax wizard built into the store admin
- Automatic calculation of tax amount during checkout
- Easy setup to select tax percentage by state, county, zip code or country
- Have the ability to mark down nontaxable products
- Support Canadian tax system
- Choose if tax should be applied before or after discounts
- Choose whether specific customers or customer groups are exempt from taxes
To make sure you abide by all the new tax regulations, you need to have a sales tax software to calculate and distribute internet sales tax appropriately. Not only does your ecommerce solution have to provide this feature, it also has to be easy to set up so that you only need to input the necessary information once and the software will take care of the rest.
What you need is a full service all-in-one hosting, design, and marketing software made specifically for e-commerce businesses. One that lets you set up your store in minutes, and provides powerful tools to help with not only collecting internet sales tax, but also SEO, product marketing and mobile commerce. Check out the best possible e-commerce solutions available at http://www.makeanonlinestore.com and try them out yourself absolutely free, no credit card required!
What you need is a full service all-in-one hosting, design, and marketing software made specifically for e-commerce businesses. One that lets you set up your store in minutes, and provides powerful tools to help with not only collecting internet sales tax, but also SEO, product marketing and mobile commerce. Check out the best possible e-commerce solutions available at http://www.makeanonlinestore.com and try them out yourself absolutely free, no credit card required!