Do you need to collect and remit sales tax in Idaho?
Most businesses that sell tangible personal property or taxable services in Idaho are required to collect and remit sales tax. The Idaho State Tax Commission defines tangible personal property as, “anything you can feel, see, touch, weigh, or measure.” However, this doesn’t include real property. Businesses with a physical presence in Idaho as well as those outside the state who make a certain number of gross sales into the state are both liable for sales and use tax. However, there are certain exemptions available for specific types of sales, such as sales to non-profit organizations or certain medical equipment. If you need a more detailed list of businesses, organizations and items that are exempt from sales tax, you can find it here.
Do you have sales tax nexus in Idaho?
If you’re wondering whether you have sales tax nexus in Idaho, it’s important to first define what sales tax nexus is. Nexus is the connection between a business and a state that triggers the obligation to collect and remit sales tax. In Idaho, a business has physical nexus if it has physical presence in the state, such as a storefront or warehouse. This applies to both in-state and out-of-state businesses that make sales into Idaho. But what about remote retailers or those who sell exclusively online? These types of businesses will still have nexus in Idaho if they make a certain amount of gross income from Idaho customers. This type of nexus is referred to as economic.
Physical sales tax nexus in Idaho
Retailers with physical nexus are described as doing business in Idaho if:
- They own property in Idaho
- They have an office, warehouse, sales room, or employees in Idaho
- They have sales representative or agents in Idaho
- They keep goods in Idaho that will be sold
Note: Something that Idaho does a little different from many states is imposing a contractor tax on contractors. This is because Idaho views contractors as the consumers (or end-users) of all the goods they use. Contractors must therefore pay sales tax on all purchases, including equipment, tools, and supplies they use on their projects. You can find more details on Idaho contractor tax here.
Economic sales tax nexus in Idaho
For a business to have economic nexus in Idaho, they must meet these two requirements:
- Be a retailer located outside the state with no employees, merchandise, or otherwise residing in the state.
- Make more than $100,000 in gross sales of tangible personal property to Idaho residents.
Are marketplace facilitators required to collect and remit sales tax in Idaho?
Yes. As of July 1, 2019, marketplace facilitators are required to collect and remit sales tax on behalf of their third-party sellers. Under Idaho law, a marketplace facilitator is responsible for collecting and remitting sales tax on all taxable sales made through its platform, unless the third-party seller can demonstrate that it is already collecting and remitting sales tax on those sales.
What platforms are marketplace facilitators?
Not sure what defines a marketplace facilitator? In short, marketplace facilitators are companies that provide a platform or service for third-party sellers (you) to sell their products or services to customers. The facilitator collects payment from the customer, processes the transaction, and may also manage shipping and returns.
Filing Idaho Sales Tax
We hope you like step-by-step tables as much as we do! If you think you need to start collecting and remitting sales tax in Idaho, use these steps as a guide:
|1||Register for a sales tax permit||Complete the Idaho Business Registration form either online, in person, or using a paper form.||Online Registration; Paper Form IBR-1|
|2||Wait for your permit to arrive||The Idaho State Tax Commission will process your application and send your permit via mail. Online registration takes around 10 days; mailing a paper form takes around 4 weeks||Idaho Seller’s Permit|
|3||Collect sales tax on taxable sales||Collect sales tax from your customers on all taxable sales||Idaho State Tax Commission|
|4||Keep accurate records of your sales and tax collected||Record all sales and tax collected, and keep the records for at least three years||Use whatever record-keeping method you wish that works for your business. There are many options!|
|5||File your sales tax return according to the filing frequency assigned to you by the Idaho Tax Commission||File your sales tax return and pay any tax owed by the due date, either online or by mail. To file online, you will need to register for a TAP account.||Taxpayer Access Point (TAP); Idaho will send sales and use tax forms after registration|
Let us file for you!
If filing sales tax returns is too overwhelming or time-consuming, you’re not alone. Running a business is demanding work and filing tax returns is a nuisance. We at SalesTaxSolutions are here to make things easier! As a company, we help businesses like yours deal with the many state-by-state regulations and file your sales tax returns for you. We’ve got 20 plus years of knowledge and experience to help you get back to saving time and making money as soon as possible. Message, email or call us at 888-544-7730 for a free quote today!
When are sales tax returns due in Idaho?
When you register for an Idaho seller’s permit, you will be assigned either a monthly, quarterly, or annual filing frequency.
|Filing Frequency||Due Date||Reporting Period|
If any of these due dates fall on a weekend of a state holiday, returns are due the next business day.