The editor found that no matter in the past or now, whether it is an individual seller or an enterprise store, as long as the Amazon platform is operated, they are very concerned about the tax declaration.
In fact, regardless of whether the company is registered in the United States or China, as long as Chinese sellers engaged in e-commerce on Amazon in the United States constitute sufficient physical presence, they must collect sales tax from consumers for the US State Revenue Service.
What is US sales tax?
U.S. sales tax is a tax levied by U.S. state and local governments on goods and services based on a certain percentage of their sales price. It is a tax paid by consumers when they are consumed in the United States. Merchants are responsible for helping the local government collect on their behalf, and then pay to the local government once a quarter (once a year when the turnover is small).
At present, 46 states in the United States have set up sales tax. Sales tax has become the main source of fiscal revenue for state governments, accounting for more than 40% of state government tax revenue. The proportion of sales tax collected in each state is different.
US sales tax payment process
Register with the state government to obtain a tax ID number
Both Chinese companies and American companies need to use EIN for tax declaration. You can contact Dream Business Service for registration.
EIN is very important and will be used to declare Federal Income Tax (Federal Income Tax), State Income Tax (State Business Tax), Payroll tax (salary tax) and apply for Seller Permit and other related taxes.
The documents required to apply for a U.S. federal tax identification number (EIN) are as follows:
US company registration certificate;
The business or registered address of the U.S. company;
The purpose of the US company's application for a tax ID, such as a new company's business, or the company's account opening needs, etc.;
Industries in which U.S. companies operate
Collect sales tax from consumers
Amazon's background can set up automatic collection to collect sales tax from consumers. Amazon said Tax Collection is a new service that will automatically calculate, collect and deduct sales tax for third-party merchants who sell to customers in certain states.
If you let Amazon pay the tax, Amazon will charge 2.9% of the tax as a handling fee, because paying sales tax is the responsibility of the seller, not Amazon.
However, many sellers think that Amazon has already withheld and paid sales tax, so they don’t need to worry about it themselves, and special attention is needed here. When a seller's sales reach a certain ceiling, they must file their own sales tax returns and, in certain circumstances, income tax returns.
So, how do sellers in the United States determine whether they need to file their own sales tax? Simply put, you need to declare yourself when you generate sales tax-related business activities.
For example, there are offices, stores or employees, sales staff, contractors, etc. in a certain state in the United States; warehouses in a certain state, such as Amazon's FBA warehouse or other third-party overseas warehouses, etc. In addition, when the sales amount reaches a certain upper limit, or the number of transactions exceeds a certain limit, it is all business activities related to sales tax.
Report the total amount withheld to the state tax agency on time
First , organize the sales report according to the operating platform , then log in to the official website of the state government, determine the Origin-Base or Destination-Base, and determine the tax rate. Second, fill in the declaration form online, and fill in the County, City, and District according to the determined tax rate. (District), and finally submit the tax form.
Pay taxes according to the method specified by the state government
Filing sales tax returns and paying taxes to the states is the final step in meeting your sales tax obligations. Sellers can file tax returns with linked states on a monthly, quarterly, or annual basis, depending on state legislation and store sales.
The tax settlement method varies from state to state, and sellers need to pay attention to the official notice in a timely manner.
Summary of FAQs
A: My Amazon store is not registered as a US company, can I not pay tax?
Q: Whether the company is based in the United States or China, as long as the goods on Amazon are sold to the United States, it needs to collect and pay sales tax from consumers on behalf of the U.S. State Revenue Service, otherwise the tax will be charged, or even Amazon will be closed. account and risk legal action.
A: If the store opened by the main body of the US company on Amazon has already been withheld and paid, can it be considered that Amazon has applied for a sales license for us, and can the US independent station not apply for a sales license?
Q: Although Amazon is withholding and paying in the name of the platform, according to the U.S. tax law, sellers need to apply for a sales tax license and declare sales tax in the state where the sales tax is associated. However, Amazon does not give sellers a sales license, so it is independent Station sales tax still needs to be declared by yourself.
A: What happens if the required sales tax is not filed?
Q: For sellers who do not meet the sales tax requirements, the state government can take various coercive measures to collect, including review, recovery, transfer to the state attorney general's office for legal action, etc., and may even face jail!
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