SAAS Sales Tax

Video: Do SAAS Companies Pay Sales Sales Tax?

SAAS sales tax does exist, it’s not just for tangible goods. A couple of years ago various states put into place SAAS sales tax.

So your first question is probably where in the US should I keep in mind that SAAS sales tax exists? And the answer is to go ahead and go to our website, we’ve got a map up there for you. It was created by Taxjar, they’ve done a wonderful job of outlining which states you want to consider for SAAS sales tax.

For example, New York does have a SAAS sales tax, whereas California does not. Next question we usually get is, you know, do I have nexus in that state? Is that sales tax applicable to me? And the answer is do you have nexus in that state? So do you have sales in that state, revenue or payroll? You’re going to want to work with your CPA to figure out whether or not you have a presence in that state and you do need to file.

Next question that we always get is how much is the SAAS sales tax? That really does vary state by state, so for example, Connecticut is about one percent, New York is about eight percent.

The last question we always get is, you know, how often do I have to file? Usually, it’s quarterly, but sometimes it’s monthly.

Of course we recommend that you work with an experienced CPA who know Software as Services businesses. Head over to our SaaS accounting page to learn more about how we’ve successfully served hundreds of these types of startups.