Sales taxes are taxes collected on the sale of goods within your home state. Your territory may include state, county, and multiple municipal sales tax jurisdictions. Use the address of each school (or location of delivery) to determine jurisdiction. The definition of retail sales and what goods and services are taxable vary among the states. Nearly all jurisdictions provide numerous categories of goods and services that are exempt from sales tax, or taxed at reduced rates. The purchase of goods for further manufacture or for resale (wholesale) is uniformly exempt from sales tax. Examples of items for which you will not pay sales tax include your lab processing costs, packaging inserts, stickers, CDs, envelopes, and bags — anything that goes into your final product, handed over to the customer. You will charge your customers sales tax on the final product.
Collecting, Filing, and Paying Sales Tax
You must register and obtain a sales tax license from your state’s department of revenue. You will collect sales taxes at the time of sale and report and pay them to the state, city, and county on a monthly or quarterly basis. Some states provide a discount to businesses upon timely payment of the collected tax. Report your discount “income” as “Sales Tax Discount,” in EZGo. Most states allow and some require electronic remittance.
You must file tax returns with each government jurisdiction in which you are required to collect sales tax (state, city, and county). Sales tax returns typically require you to report your total taxable sales for the period and the worksheet or website will help you calculate the discount, penalty, late fee, interest, and amount of tax due, automatically.
REMEMBER – Use EZGo to calculate your monthly or quarterly sales — the amounts will be calculated without sales tax. Photocart’s home page and sales page will give you total sales INCLUDING sales tax.
How to Determine Your Gross Taxable Sales for Paying Sales Tax
To determine your Gross Taxable Sales for the period, open EZGo and select “Profit and Loss.” Enter the start date and end date for the tax reporting period you need and click “Go.” At the top of the report you will find “Sales.” Be care full not to use the “Total” income figure, as that includes shipping sales (we don’t charge tax on shipping)
Let’s say your sales for the period were: $7720.00
Use this number to report Total Taxable Sales to each jurisdiction. For example, if the total tax is broken down as 4.5% state, 3% city, and 1.5% county, you will end up paying,
$7720 x 0.045 = $347.40 to the state
$7720 x 0.03 = $231.60 to your city
$7720 x 0.015 = $115.80 to the county
Total = $694.80