Sales tax return basics
Who needs to file when?
Different states have different sales tax return filing dates. Sales tax remittance can be required on a monthly, quarterly or other basis, often based on how much sales and use tax a business collected in the relevant reporting period.
For example, New York breaks down the filing schedule into three categories: annual, quarterly and part-quarterly (monthly). How frequently you must file sales tax returns depends on the amount of your taxable sales (and purchases subject to the use tax) or the amount of tax due.
Businesses that owe $3,000 or less in sales tax during the annual filing period, defined as March 1 through February 28 (29 in a leap year), should file an annual return.
Quarterly returns must be filed if taxable receipts, purchases subject to use tax, rents, and amusement charges are less than $300,000 during the previous quarter. (Most vendors file quarterly when they first register to collect sales tax.) The filing periods for quarterly filers are March 1 – May 31, June 1 – Aug. 31, Sept. 1 – Nov. 30 and Dec. 1 – Feb. 28 (29 in a leap year).
$300,000 of taxable receipts or more in a quarter, or a business that is legally defined as a distributor has sold a total of 100,000 gallons or more of automotive fuel (taxable or nontaxable), and a part-quarterly (monthly) return must be filed. The filing period begins with the first month of the next sales tax quarter if the business files an annual or quarterly sales tax return.
The Prompt Tax return applies, in general, if the annual sales and use tax liabilities are greater than $500,000. The filing period is monthly.
Even if a business does not make any taxable sales or purchases during the reporting period, sales and use tax returns must be filed by the due date.
The method of filing varies as well. While many returns can (and must) be filed electronically using the Web File feature on the New York State Department of Taxation and Finance web site, certain others, including annual filers and certain taxes on parking services in New York City, must be printed out and physically mailed to the department.
Check with a professional CPA or tax lawyer, and contact your state’s tax commission or department of taxation/revenue to be sure your business is compliant and up to date.