SALT Report 1381 – The Pennsylvania Department of Revenue has extended the deadline that requires remote sellers with a physical presence in Pennsylvania to become licensed and begin collecting sales tax until September 1, 2012.
Businesses with Pennsylvania nexus that do not register and collect tax by the deadline will face a variety of enforcement options, such as assessments, audits, liens, or a referral to the Attorney General’s office or a collection agency.
In December the department issued Tax Bulletin 2011-01 that explains the existing sales tax nexus law for remote sellers and clarifies the department’s authority to require e-commerce and out-of-state sellers to collect sales tax.
The bulletin provides examples of in-state activities that the department deems sufficient to require sales tax registration and collection. These activities include, but are not limited to:
- A remote seller stores its property or the property of a representative at a distribution or fulfillment center located in Pennsylvania. This applies regardless of whether the center also stores the property of third parties distributed from the same location.
- A remote seller has a contract with an entity or individual physically located in Pennsylvania and whose website has a link that encourages purchasers to place orders with the remote sellers and the in-state entity or individual receives consideration for the relationship with the remote seller.
- A remote seller utilizes affiliates, agents and/or independent contractors located in Pennsylvania who provide repair, delivery or other services relating to the tangible personal property sold by the remote seller to Pennsylvania customers.
- A remote seller’s affiliates, agents and/or independent contractors provide service within the Commonwealth, including, but not limited to storage, delivery, marketing, or solicitation of sales, that benefit, support and/or complement the remote seller’s business activity.
- A remote seller has employees who regularly travel to Pennsylvania for any purpose related to the remote seller’s business activity.
- A remote seller accepts orders that are directly shipped to Pennsylvania customers from a Pennsylvania facility which is operated by the remote seller’s affiliate, agent or independent contractor.
- A remote seller regularly solicits orders from Pennsylvania customers via the website of an entity or individual physically located in Pennsylvania, such as an internet link.