Does anyone have any insight into when to charge tax on an Amazon listing vs. when not to? From what I am seeing, it looks like it depends where your orders are being fulfilled from and where you have employees working. Are there other scenarios when tax should be applied? Does Prime influence this at all? Thank you!
First I am not a tax expert or qualified to give tax advice…
With that out the way, I am in Australia and my understanding is that when I ship goods to Amazon in the US for sale on Amazon.com that is an export sale so no sales tax (GST) is due here. I am still taxed on profits I make of course, but I presume you are talking sales tax.
When Amazon finally gets to Australia and I am shipping goods to a warehouse here in Australia then my presumption is that would be a domestic sale and subject to sales tax.
The sale is taking place in the country where the amazon warehouse you shipped too is located.
So if the warehouse you are sending to is in another country from where you reside/have a business/ are resident for tax purposes then you would not be accounting for sales tax in your country. If the warehouse is in your country, then sales tax is going to have to be accounted for by you.
I don’t know enough about the responsibilities of International sellers like Peter, but there’s still some question about what’s required for US sellers.
Assuming you use FBA, the conservative approach is to pay sales tax in any state which Amazon has a fulfillment center. At the very least you should be paying sales tax in the state that your entity is registered and where you have employees (assuming they are states that charges tax). You can read up on this by checking out the TaxJar.com website, but keep in mind that they are biased since their business offers tax administration services to sellers.
Thanks for your response, that is what we have been doing but like you said there is some question about what exactly is required. TaxJar does a good job of walking through it, thanks again!