If you are selling products in Idaho, you need to be aware of sales tax rates and filing requirements. Idaho Sales Tax rate is 6%, and some local city and county taxes may apply. A sales tax calculator is a handy tool to help you determine the correct sales tax for each item you sell. A sales tax calculator will save you time and money and ensure compliance with Idaho’s sales tax rules.
Idaho uses a destination-based sales tax system, meaning that sales tax is charged on the final sale at the buyer’s location. In addition to a base state sales tax, some local jurisdictions impose additional local sales taxes of up to 3% for combined rates ranging from 6% to 9%. If you have nexus in Idaho, you must collect and remit sales tax on all taxable goods and services you sell. Nexus is established by a business’s physical presence in the state (physical nexus) or through economic activity (economic nexus).
Businesses that sell taxable goods or services in Idaho must register for a sales tax permit. You can get a permit by registering online with the Idaho Sales Tax Commission. You’ll need your business’s federal tax ID number (EIN) and a physical address or location. In addition, you may need to meet the state’s economic nexus requirements.
How to Pay Idaho Sales Tax?
Once you have your Idaho sales tax permit, keeping accurate records of taxable and non-taxable sales is important. You must also file and remit your sales tax returns monthly, quarterly, or annually, depending on your total liability. These returns contain information about your taxable sales, the sales tax rate, and any exemptions or deductions.
Idaho Sales Tax is based on the shipment’s destination rather than the origin (destination-based sourcing). Therefore, you need to use your POS system or mobile sales app to determine the correct local sales tax rate and apply it to each order.
If you don’t file your return or remit your collected sales tax on time, Idaho may assess you with a penalty and interest. To avoid these penalties, keep up with your filing deadlines and stay on top of any changes in sales tax rules or regulations.
Idaho sales tax returns and payments are due on the last day of the month following each reporting period. A penalty is added to the amount due if a return is filed late. If a return is filed on time, a refund may be issued for uncollected sales tax.