New York – sales and use tax regulations

Sales tax regulations
  • by admin
  • December 3, 2022

New York has a sales tax rate of 4% at the state level. However, local governments within the state are allowed to collect sales tax up to 4.875%. There are 987 local tax jurisdictions in New York, and the average rate of sales tax amounts to 4.23%.

The highest sales tax rate amounts to 8.75% in Flushing, Staten Island, Brooklyn, Bronx, New York, and 42 other cities.

As per State law of New York, the businesses are required to register for sales tax and obtain a certificate of authority. This certificate authorizes the vendor to collect sales tax and remit to the state; the certificate holder is also authorized to accept and issue a tax exemption certificate in the state.

It’s important to note that sellers will be required to register for sales tax if considered vendors. In New York, the seller is considered a vendor when rendering service or selling tangible personal property and meeting any of the following conditions.

  • The business is operated through a place in New York.
  • The business is done in New York by rendering services or selling taxable, tangible property.
  • The business is done online. However, it has a certain connection with the state; it might be in the form of a catalog or any other connection.
  • The seller is out of New York. However, their business performs regular business activities through vehicles or their agents in the state.

It’s also important to note that businesses performing repair activities for tangible property are required to register for sales tax in the state.

Sales tax registration requirement for business without physical existence in the state

The decision in the United States court South Dakota v. Wayfair (138 S.Ct. 2080)  dated June 21, 2018, made it clear that states can allocate responsibility to charge sales tax to the businesses with no physical existence in the state.

The effects of this ruling were significant, and the provision to be a vendor was effective in the case of non-physical businesses. The term vendor refers to the person who is required to collect and remit sales tax to the state. So, the business without physical existence is presumed to be a vendor in the state if, for the immediately preceding four tax quarters,

  • Gross receipt against the sale of tangible physical property in the state is $500,000 and,
  • More than 100 sales of tangible property were delivered.

So, even if the business does not have a physical existence in New York. However, if they have fulfilled the given criteria, they must register, collect, and remit sales tax in New York.

How a business determines if they need to register for sales tax in New York?

The following two criteria are important to determine if you need to register for the sales tax in New York.

Gross receipt from sale of tangible property delivered in the state amounts to $500,000, and the total number of transactions were more than 100 during the preceding four sales tax quarter as

  • March 1 through May 31,
  • June 1 through August 31,
  • September 1 through November 30, and
  • December 1 through February 28/29.


RKB Accounting has expertise in cross-border taxation and has been providing accounting and taxation services for the last fifteen years in Canada and USA. RKB services include incorporating a business on both sides of the border, bookkeeping, sales tax, payroll, and corporate and personal income tax. RKB’s expertise includes cross-border tax planning, long-term tax planning, helping business start-ups, business structure planning, and resolving complex tax matters.

Disclaimer: Information in the blog/post/article has been presented for a broad and simple understanding. This is not legal advice. RKB Accounting & Tax Services does not accept any liability for its application in any real situations. You need to contact your accountant or us for further information.


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