Monday, November 7, 2016

Do You Have Sales Tax Nexus in New York



What is Nexus?

The need to collect sales tax in New York is predicated upon having a physical connection with the state. This is a concept known as nexus. Nexus is a latin word that means "to bind or tie" and it stands as the deciding factor for whether the New York Department of Taxation and Finance has the legal authority to require your business to collect, file, and remit sales tax.


What situations or activities may trigger nexus in New York?
Sales tax nexus in New York can be triggered by a number of factors. The most common include having a physical location (office, warehouse, plant, etc.) within the state, having employees within the state, or conducting marketing activities within the state.
And more recently, internet commerce has sparked debate over what activities can trigger nexus and where sales tax should be collected. For example, Fulfillment by Amazon merchants may find their products stored in Amazon warehouses across the country. This presence of physical goods in a state may trigger nexus and expands the complexity of managing sales tax compliance. 

Does Amazon have Fulfillment Centers in New York?
Yes, there are Fulfillment by Amazon(FBA) in NY; one in New York City and another is scheduled to open this fall 2016 in Bethpage-Long Island, NY.

Click-through nexus

Click-through nexus in New York constitutes a situation in which a seller outside New York makes a sale to a resident of the state that is initiated through online contact with a 3rd party. Working with an affiliate marketer is a common example of a way in which click-through nexus may be triggered.
New York does have click-through nexus. If you are selling taxable goods to New York residents via affiliate marketers who are residents of the state. 
Please contact us for a consultation to determine whether you have triggered New York nexus.  info@laebusiness.com