Q: My understanding is that there is no seller’s permit in the state of New Hampshire for the type of business I am operating… Is there a license that I need to obtain to collect sales taxes from other states outside of NH?
Thank you to Ronnie and Gracie Hanson of Rayne Refillery in New Hampshire for this question! You are correct, New Hampshire does not collect sales tax on goods purchased in the state, which means you are not required to obtain a seller’s permit in The Granite State. However, things get a little more complicated when it comes to online sales. Depending on the scope of your business, you may need to collect sales taxes in other states if your business delivers goods to locations outside New Hampshire. Here’s what you need to know:
Will I ever need to obtain a seller’s permit or resale license in New Hampshire?
No. New Hampshire does not impose a state sales tax, so you won’t need a seller’s permit or a resale license to make sales within the state of New Hampshire.
What if a buyer from outside New Hampshire asks to see my resale license?
A resale license (or certificate) is often required for wholesale purchases. If you’re purchasing items from an out-of-state supplier who asks to see your resale license, you can direct them to the New Hampshire Department of Revenue Administration. In fact, the department suggests printing its Taxpayer Assistance – Requests for Resale & Exempt Certificates page and presenting that to the supplier in lieu of a license.
Do I need to pay taxes for my business in New Hampshire?
Probably. Even though New Hampshire doesn’t impose sales tax, the state enforces other forms of taxation, such as (but not limited to):
For more information about business taxes in New Hampshire, or to register your business with the Department of Revenue, visit the state’s online tax portal: Granite Tax Connect. If you have further questions about your business’s tax obligations, it’s probably a good idea to reach out to a business attorney or CPA.
Am I required to pay sales tax if my New Hampshire business sells products out-of-state?
This is where things get tricky. The obligation to pay sales tax is usually determined by where a purchased item gets delivered. So, if your customer lives in New Hampshire, great! No sales tax. But, if your customer lives in nearby Vermont (which has a 6% sales tax), you may be required to collect sales tax on that purchase.
How do I know whether or not I need to collect sales tax in another state?
Each state determines its own rules when it comes to business operations and online sales. To determine whether or not you’ll need to pay sales taxes in another state, you’ll need to be aware of:
- State laws regarding taxable goods
- What it means to have nexus
“Nexus” is a legal term that essentially sets the parameters for what it means to “do business” in another state. This can get complicated, but for most online sellers whether or not you have “nexus” will most likely be determined by a dollar amount (how much you sell in a particular state), or a certain number of transactions.
To be certain of your tax obligations as an online retailer, it’s a good idea to reach out to a CPA.