If you need to register for FL sales tax, it can be overwhelming. Read below for a how-to guide from our Tampa Accountant.
Navigating sales tax is hard enough, let a Tampa Accountant help you register for sales tax in Florida so you can avoid any hiccups!
Florida Sales Tax 101:
Registering with Florida Department of Revenue
Understanding Remote Sales
Sales Tax is one of the many types of business taxes that Florida businesses can be subject to. The first step is triple check (through research and consulting with a Tampa Accountant), (1) whether or not you’re truly liable to file and pay sales tax, and (2) in which states are you triggering nexus. Learn more about Nexus and Florida Business Taxes before moving forward.
Now that we’ve established you’re required to register in Florida for sales tax, let’s move on!
#1 - First things first, we need to get you registered with the Florida Department of Revenue.
The FLDOR portal is a one-stop website where once registered, you can apply for new tax IDs like sales tax, payroll tax, and all things in between. It’s a semi-long process as their website aims to ask enough questions to help you figure out which Florida Business Taxes are applicable.
Register for a FLDOR Account Here!
Once registered, log into the portal and click “Start a New Application”. From there, you will enter basic information about your business such as the date of first taxable activity (aka first taxable sale), your business name, address, and contact information.
#2 - What if I am not based in FL but I sell a lot in FL? Understanding ‘remote sales’.
This question is asked early on so that the application knows where you’re an in-state (FL) or out-of-state seller. Sometimes, your business can grow so big that although you may not be ‘present’ in every state, you’re still liable for sales tax there. This is where nexus comes into play. Presence can be in the form of volume/sales and not just the traditional version of ‘presence’ which used to be having an office, employees, warehouse, etc.
In this section, FLDOR describes 3 key terms that are only really applicable to e-commerce sellers: (1) remote sales, (2) remote sellers, and (3) marketplace facilitators.
Remote Sales (Out-of-State Sellers)
Retail sales of taxable items are remote sales subject to Florida sales and use tax, including any applicable discretionary sales surtax, when:
The item is ordered through the Internet or by telephone, mail, or other methods of communication,
The order is received by the seller outside Florida, and
The item is delivered to a Florida address.
Remote Sellers (E-Commerce is the common example)
A seller located outside of Florida is required to register to collect and remit sales tax on the retail sale of taxable items, including any applicable discretionary sales surtax, if all the following conditions apply:
The seller directly received the order of the taxable item.
The taxable item was delivered to a Florida address.
The seller made remote sales of taxable items delivered to Florida addresses in the previous calendar year that totaled $100,000 or more.
If the seller also uses a marketplace provider to facilitate retail sales through a marketplace, the seller excludes those sales when determining whether the seller is required to register. Sales facilitated by a marketplace provider through a marketplace will be reported by the marketplace provider.
Marketplace Providers (Amazon is the common example)
A business that enters into agreements with sellers to facilitate retail sales by listing or advertising items for sale in a marketplace is required to register to collect and remit sales tax, including any applicable discretionary sales surtax, on behalf of the marketplace sellers, if both the following conditions apply:
The business collects payments for items sold to customers on behalf of a marketplace seller and transmits all or part of the payment to the seller.
The business facilitated, through its marketplace, taxable remote sales in the previous calendar year that totaled $100,000 or more.
A marketplace includes an electronic medium or a physical place where items are offered for sale.
If you have any questions while navigating this part of the application, contact a Tampa Accountant and we can walk you through it!
What if I am based in FL but sell to other states? Why you might be liable to filing and paying sales tax to other states.
By nature, E-Commerce businesses process most, if not all, of their sales online. This poses a unique challenge as selling in multiple states and jurisdictions means the possibility of creating nexus.
Sales tax nexus defines the level of connection between a taxing jurisdiction such as a state and an entity such as your business. Until this connection is established, the taxing jurisdiction cannot impose its sales taxes on you.
There are 2 ways to establish a nexus. Revenue and Volume.
For some states, that connection is a dollar value. For example: if you are based in California but sell a lot in Florida, Florida's nexus for out-of-state vendors is triggered when you hit $100,000 annual revenue from Florida residents. That could mean one sale at $100,000 or 100,000 sales at $1. Either way, you hit Nexus in Florida and will be required to file and remit with the Florida Department of Revenue.
For other states, that connection is based on sales volume. For example: if you are based in Florida but sell a lot in North Carolina, then you just have to pass 1 of 2 tests to qualify for Nexus. You either have to have $100,000 in sales or 200 transactions. Whichever comes faster. Again, could be 200 items sold at $1, but you’d qualify for Nexus.
For a complete guide to nexus by State, Click Here!
But what if I only sell on Amazon, don’t they handle everything?
The short answer is: no. Amazon will:
Collect and remit taxes to your home state
Normally alert you if you’ve hit Nexus in other states
Generate reports based on sales by the state to help you self-report
Amazon will not:
Register you for any sales tax IDs
Report to any states other than your home state
Handle any Department of Revenue notices you receive
It’s important that you understand those limitations because although Amazon is otherwise ‘automated’, the compliance piece is not. Additionally, when selling on Amazon, special sales tax rules apply that are critical to know:
If your inventory is held out of state, you qualify for Nexus in that state and must register to file and report in that state
This is huge! Because although you might not be selling there, you still have physical Nexus and qualify to register. This is also important because Amazon has fulfillment centers all over the US. You must review monthly to see where your inventory is housed to make sure you’re on top of compliance. So if you’re based out of FL but hold inventory in NC and sell to SC, you’re triggering Nexus in potentially 3 states even though you haven’t left your home office!
After you submit your Florida sales tax application:
It takes about 2-3 days to receive your Tax IDs online
FLDOR will also mail you physical copies of your Tax ID and resale certificate
Make sure you note which quarter your first taxable activity was in, as that will be the first quarter FLDOR will expect your first sales tax return
Website to manually file your sales tax returns: https://ritx-fl-sales.bswa.net/
You can also pull your resale certificate PDF from the above website!
Every state does its resale certificate differently. Some states have PDFs that you fill out yourself. Other states like FL, generate one for you. It’s important to research the regulations of each state. A Tampa Accountant can assist you with this as we’ve applied for sales tax IDs in all 50 states!
Why Work With Taxes Tampa?
For over a decade, Taxes Tampa has sought out to be a communication-focused Tampa Accounting firm. We don’t operate on a volume-based business model which allows us to check in with our clients more than the average accountant in Tampa and offer our clients a more hands-on and advisory tax experience. We want to ensure you understand the ABCs of LLCs, Taxes, and everything in between. Contact us today for a free tax consultation with one of our Tax Accountants in Tampa!
Foot Notes:
Interested in learning more about sales tax? Click Here
Interested in learning about other FL Taxes you may be subject to? Click Here
Ready to meet with a Tampa Accountant? Click Here