How to File and Pay Sales Tax in New York

Sales tax in New York is a consumption tax applied to the retail sale of certain goods and services. Businesses generally collect this tax from customers at the point of sale and then remit it to the New York State Department of Taxation and Finance. This guide outlines the steps involved in preparing, filing, and paying sales tax, covering necessary information, forms, submission methods, and ongoing responsibilities.

Preparing Your New York Sales Tax Return

Before submitting any sales tax return in New York, businesses must compile specific financial data. This involves categorizing sales into gross sales, taxable sales, non-taxable sales, and exempt sales, along with identifying any applicable credits or deductions.

Distinguishing between taxable and non-taxable transactions is essential. In New York, sales tax generally applies to tangible personal property unless specifically exempted. Examples of taxable items include physical goods like jewelry, furniture, and prepared food, as well as certain services such as utility, telecommunication, and some personal care services. Conversely, many services are exempt unless explicitly defined as taxable. Common exemptions include most food for home consumption, prescription medicines, and clothing or footwear costing under $110 per item.

The primary sales tax return forms are Form ST-809, the New York State and Local Sales and Use Tax Return for Part-Quarterly (Monthly) Filers, and Form ST-100, the New York State and Local Quarterly Sales and Use Tax Return. These forms, along with their instructions, are available for download from the New York State Department of Taxation and Finance website.

When completing these forms, businesses must report their total gross sales and services from all New York State business locations, including sales delivered into the state from outside locations. They also need to report taxable sales, non-taxable sales, and any taxable purchases where tax was not originally paid. The total tax due is calculated by applying the applicable state and local sales tax rates, which can vary across counties and cities.

Filing and Paying Your New York Sales Tax

After preparing the sales tax return, the next step is filing and remitting payment. New York encourages electronic filing, which is often mandated. The primary online submission method is through the New York State Department of Taxation and Finance’s Business Online Services account.

To file online, businesses log into their Business Online Services account, select the sales tax service, and choose the correct filing period. The online system may pre-populate some data, which should be reviewed against the prepared return. After making any necessary adjustments, the return can be submitted electronically, and a confirmation number is typically provided upon successful submission.

While electronic filing is preferred, filing by mail is an option, though it may be subject to e-filing mandates. If mailing, send the completed return and any required payment coupon to the address provided in the form instructions. It is advisable to keep a copy of the completed return for business records.

Businesses can pay electronically via ACH debit or credit, or by credit card, though credit card payments may incur a fee. Payments can also be made by check or money order, payable to “New York State Sales Tax,” including the sales tax identification number and form type. Electronic funds transfer (EFT) may be required for certain taxpayers.

Ongoing Sales Tax Responsibilities

Maintaining sales tax compliance in New York involves ongoing responsibilities beyond initial preparation and filing. The New York State Department of Taxation and Finance assigns a filing frequency to businesses, which can be annual, quarterly, or monthly. This frequency is determined based on factors such as the business’s sales volume, with higher sales volumes typically requiring more frequent filings.

Sales tax returns and payments are generally due by the 20th day of the month following the end of the reporting period. For example, quarterly filers typically have due dates in April, July, October, and January, while monthly filers submit returns by the 20th of the subsequent month. Businesses should always confirm their specific due dates and assigned filing frequency through their Business Online Services account.

Accurate and organized record-keeping is essential for ongoing sales tax compliance. Businesses must maintain detailed records of every sale, including the amount and sales tax collected, for a minimum of three years from the return’s due date or filing date, whichever is later. This includes sales slips, invoices, cash register tapes, and any other original sales documents, ensuring they provide sufficient detail to determine the taxability of each sale. Records of purchases, especially those made with exemption certificates, and copies of filed sales tax returns should also be retained.

If an error is discovered on a previously filed sales tax return, businesses may need to amend it. The New York State Department of Taxation and Finance website provides guidance and forms for making such corrections. Promptly addressing errors through an amended return helps ensure accuracy and continued compliance.