How to Comply with Puerto Rico’s Notice and Reporting Requirements
Summary: This blog post will provide you with the information and access to the tools you need to comply with Puerto Rico’s Notice and Reporting requirements.
Does Puerto Rico Have Economic Nexus Requirements?
As of the publication of this blog, Puerto Rico does not have economic nexus regulations. They do, however, have Notice and Reporting requirements. At the end of this blog, we provide you with the tools you need to comply with Puerto Rico’s Notice and Reporting requirements.
If you read our blog, States Where Notice and Reporting Requirements Still Matter, you know that the sales threshold for Puerto Rico’s Notice and Reporting requirement is $0. That means that a single sale into Puerto Rico can create a notice and reporting obligation.
In other states, many companies have opted to get a sales tax permit in lieu of dealing with notice and reporting requirements. In most states, this has been the “easier” option. However, this is simply NOT true in Puerto Rico
Can a Remote Seller Get a Sales Tax Permit in Puerto Rico?
Puerto Rico will issue a sales tax permit upon application. However, Puerto Rico requires you to enter a physical location in Puerto Rico on their online portal. Without a physical location in Puerto Rico, they would prefer you to comply with notice and reporting requirements instead of keeping a sales tax permit.
You should also note that registering for a sales tax permit in Puerto Rico triggers the opening of a corporate income tax account. Corporate income tax in Puerto Rico is the equivalent of paying income tax to the IRS in the United States. You can learn more about this requirement on our blog, Should Your E-Commerce Business Get a Sales Tax Permit in Puerto Rico?
A Summary of Puerto Rico’s Notice and Reporting Requirements
To comply with Puerto Rico’s Notice and Reporting Requirements, you must do the following:
(1) notify the buyer on their invoice or receipt that they need to pay tax directly to the government
(2) provide a quarterly report to Puerto Rico with a list of all purchases made by residents
(3) provide an annual notice to purchasers each year
(4) provide the Treasury with a copy of each notice
The penalty for not complying with Puerto Rico’s Notice and Reporting Requirements is $100 for each transaction. Failure to file a quarterly report is $5,000 for each failure. And failure to file the annual report is $500 for each failure.
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How to File Reports with Puerto Rico to Comply with Notice and Reporting Requirements
Puerto Rico’s Quarterly and Annual Reports can be filed electronically through their “SURI” system. You can find detailed instructions on the Puerto Rico website here.
First, you will need to establish a username and password to submit the reports.
- Access the SURI site at https://suri.hacienda.pr.gov/_/
- Select “File non-merchant Declaration or Report” listed under “Other Services”
3. File your Quarterly or Annual Report