Do You Need to Get a Sales Tax Permit in West Virginia?
Quick Answer: You need to get a sales tax permit in West Virginia if you have a physical presence or meet economic or affiliate nexus requirements. 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 West Virginia, 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 West Virginia for more information about that process.
Common Ways to Have Sales Tax Nexus in West Virginia
1. Economic nexus in West Virginia
If you made $100,000 of sales or more than 200 transactions in the current or previous calendar year in West Virginia, then you are required to register for, collect, and pay sales tax to the state. If you meet this threshold, it does not matter if you have a physical presence in West Virginia. Nexus has been created based on your volume of sales.
For more information see Administrative Notice 2018-18.
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 West Virginia
The following creates physical presence nexus in West Virginia. If you have any of the following in West Virginia, you will need to get a sales tax permit:
- Office – Having or maintaining, occupying or using, within the state, directly or by a subsidiary, an office, distribution house, sales house, warehouse, or other place of business.
- Employees – Having any agent, employee or representative operating within the state under the authority of the retailer or its subsidiary, irrespective of whether the place of business or agent is located.
- Advertising – Any retailer soliciting orders from persons located in West Virginia for the sale of tangible personal property or taxable services by means of a telecommunication or television shopping system that uses a telephone or mail ordering system, including toll-free telephone numbers, reverse charge telephone systems or other telephone ordering systems, and that is intended by the retailer to be broadcast by cable television or other means of broadcasting, to consumers in West Virginia, here permanently or temporarily.
- Delivery in company vehicles.
- Providing any taxable services in the state.
For more information, please see West Virginia ARTICLE 15A, USE TAX
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 West Virginia
1. Affiliate Nexus in West Virginia
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.
A retailer is considered to do business in West Virginia if it has a relationship with a related company who:
- Solicits orders by mail, has a physical presence in the state, and economically benefits from an authorized installation, servicing, or repair facility in the state, owned or operated by a related person;
- Has a franchisee or licensee operating in the state under its trade name; or
- Has, maintains, occupies, or uses through a subsidiary an office, distribution house, sales house, warehouse, or other place of business in the state.
Do You Need a Sales Tax Permit in West Virginia If You Only Sell on Marketplaces?
If you are an out-of-state online retailer who ONLY sells on approved marketplaces (such as Amazon, eBay, etc), West Virginia sales tax will be remitted by the marketplace on your behalf. However, if you meet any of the nexus criteria above, you are still required to get a sales tax permit and remit returns, even if no tax is due.
For more information about this please see Legal Log No 19-225ds.
If you are an e-commerce seller who is unsure of where you need to get a sales tax permit, feel free to 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.