Do You Need to Get a Sales Tax Permit in Missouri?
Quick Answer: You need to get a sales tax permit in Missouri if you meet economic, physical presence, affiliate, or click-through nexus requirements as determined by Missouri. Read on for more detailed information.
What is Sales Tax Nexus Anyway?
Your business owes sales tax in any state where it has “sales tax nexus”. In short, if you have sales tax nexus you need to collect and remit sales tax. If you don’t have sales tax nexus, you generally don’t need to get a permit.
Sales tax nexus is a legal term that means you have crossed a threshold and now have a sales tax collection responsibility in the state. Nexus can be created by having a physical presence, economic presence, or by other factors. Nexus rules vary by state and retailers have specific nexus rules based on where they have people, property or inventory.
What Should You Do Once You Determine You Have Sales Tax Nexus?
Once you determine that you have sales tax nexus in Missouri, your next step is to register for a sales tax permit in the state. Check out our blog post on getting a sales tax permit in Missouri for more information about that process. If you are not interested in doing the work of getting the permit yourself, TaxValet can handle the permit registration for you with our Sales Tax Permit Registration Service.
Common Ways to Have Sales Tax Nexus in Missouri
1. Economic nexus in Missouri
Missouri does not currently have an economic nexus threshold, however, proposed HB548 would establish that if you made $100,000 in sales or had 200 transactions, then you would be required to register for, collect and pay sales tax to the state. If you met this threshold, it would not matter if you had a physical presence in Missouri. Nexus would be created based on your volume of sales. HB 548 has not yet been adopted as of the publication of this blog.
If you need help determining which states you have crossed economic nexus thresholds, check out our Sales Tax Starter Kit service.
2. Physical presence nexus in Missouri
The following creates physical presence nexus in Missouri. If you have any of the following in Missouri, you will need to get a sales tax permit.
- An office, place of distribution, sales or sample room or place, warehouse or storage place, or other place of business.
- Soliciting sales or taking orders by sales agents or traveling representatives.
- Maintaining a stock of goods in this state.
For more information, see Missouri title X Taxation and Revenue 144.605(2) and (14).
If you need help determining which states you have a physical presence in, check out our Sales Tax Starter Kit service.
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Uncommon Ways to Have Sales Tax Nexus in Missouri
1. Affiliate Nexus in Missouri
What exactly is affiliate nexus? Affiliate nexus can exist when a business has sufficient contact with a state through a separate business. If your out-of-state business has a relationship with an in-state business, then you may have affiliate nexus.
Please keep in mind that an “affiliated business” does not necessarily mean that it is a marketing “affiliate” in the typical sense of the word. Instead, “affiliate nexus” refers to the relationship between two businesses.
Affiliate nexus is created in Missouri when any person or business (except a common carrier ie: delivery service) has the following substantial nexus with this state:
- Sells a similar line of products as the vendor and does so under the same or a similar business name;
- Maintains an office, distribution facility, warehouse, or storage place, or similar place of business in the state to facilitate the delivery of property or services sold by the vendor to the vendor’s customers;
- Delivers, installs, assembles, or performs maintenance services for the vendor’s customers within the state;
- Facilitates the vendor’s delivery of property to customers in the state by allowing the vendor’s customers to pick up property sold by the vendor at an office, distribution facility, warehouse, storage place, or similar place of business maintained by the person in the state; or
- Conducts any other activities in the state that are significantly associated with the vendor’s ability to establish and maintain a market in the state for the sales.
For more information about affiliate nexus in Missouri, see Missouri Title X Taxation and Revenue 144.605(2).
2. Click-through Nexus in Missouri
What is click-through nexus? Referrals from in-state entities may trigger nexus for an out-of-state company. Out-of-state sellers of tangible personal property are presumed to be engaged in business in Missouri if they enter into an agreement with a person in Missouri for a commission or other consideration and the affiliate directly or indirectly refers potential customers to the seller, by a link on an internet website, telemarketing, an in-person presentation or another method.
For more information about click-through nexus in Missouri, see Missouri title X Taxation and Revenue 144.605 (2)e.(e).
Do You Need a Sales Tax Permit in Missouri If You Only Sell on Marketplaces?
As of the publication of this blog, Missouri is not a marketplace collection state. Subsequently, Amazon, eBay, and other marketplace facilitators are NOT required to collect or pay sales tax in Missouri on your behalf. Therefore, you, as the seller are responsible for collecting and remitting sales tax due on sales into Missouri if you are required to have a sales tax permit.
If you are an e-commerce seller who is unsure of where you need to get a sales tax permit, check out our Sales Tax Starter Kit service.
Disclaimer: Our attorney wanted you to know that no financial, tax, legal advice or opinion is given through this post. All information provided is general in nature and may not apply to your specific situation and is intended for informational and educational purposes only. Information is provided “as is” and without warranty.