Sales Tax APIThe same engine Zamp customers use.Feeling overwhelmed by sales tax filing? This comprehensive guide will demystify Pennsylvania sales tax for you.
We’ll explore how you can calculate sales tax rates for counties and cities in Pennsylvania. Plus, we’ll answer a few other questions you might have, like how to collect and when to file sales tax.
We’ll also share a white glove sales tax solution in this Pennsylvania sales tax guide to ensure you stay compliant throughout the entire sales tax lifecycle.
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Collecting Pennsylvania Sales Tax from Customers
Here are the answers to some common questions you may have on sales tax collection:
Do I Have to Collect Pennsylvania Sales Tax from Customers?
Retailers who meet these two requirements are required to collect sales tax in Pennsylvania:
- You have a sales tax nexus in Pennsylvania
- You sell taxable products or services in Pennsylvania
What Creates a Sales Tax Nexus in Pennsylvania?
Pennsylvania code states that anybody “maintaining a place of business in the Commonwealth” must collect sales tax.
This includes:
- Economic Nexus: Businesses with an economic nexus of more than $100,000 in the past 12 months.
- Physical Location: Businesses that have an office, warehouse, or storage inventory in the Commonwealth. If a non-Pennsylvania business without a physical location makes a taxable sale in the state, they need to apply for a Transient Vendor Certificate.
- Employee Location: Businesses that have an employee in the Commonwealth.
- Trade Shows: Businesses that participate in craft, trade, and other shows in the Commonwealth. Individuals and businesses renting or operating a space for shows must obtain a Promotor License.
Learn more about the sales tax nexus and when you’re required to collect sales tax here.
Do I Have to Collect Sales Tax from Pennsylvania Customers if I Sell on Amazon, Walmart, Ebay, or Etsy?
No.
That’s because Pennsylvania has a marketplace facilitator tax law, which means that marketplaces like Walmart or Amazon collect sales tax on behalf of 3rd party sellers on their platforms.
If you have a sales tax nexus in Pennsylvania, remember that you must collect sales tax on your other non-marketplace Pennsylvania sales.
Taxable Products in Pennsylvania
Most tangible personal property and services like digital sales, construction items, computers, and some grocery items like non-alcoholic beverages are taxable.
However, Pennsylvania doesn’t impose taxes on basic necessities like medical supplies as well as most food and beverages (made on premises or prepackaged).
Let’s take a closer look at how a taxable item is taxed in Pennsylvania:
Are Groceries Taxable in Pennsylvania?
No, groceries are non-taxable in Pennsylvania.
Is Clothing Taxable in Pennsylvania?
No, clothing is non-taxable in Pennsylvania.
Are Digital Products Taxable in Pennsylvania?
Yes, digital products are taxable in Pennsylvania.
Is Software-as-a-Service (SaaS) Taxable in Pennsylvania?
Yes, SaaS is taxable in Pennsylvania.
Are Services Taxable in Pennsylvania?
Some taxable services in Pennsylvania include:
- Lobbying services
- Credit reporting or adjustment services
- Secretarial or editing services
- Help supply services
- Disinfecting or pest control services
- Building maintenance or cleaning services
- Lawn care services
- Self-storage services
- Premium cable services
- Catering services
You can read more about what services are taxable in Pennsylvania in publication REV-717 “Retailer’s Information.”
Tax-exempt Items
A few tax-exempt items in Pennsylvania are:
- Books and stationery items, such as school textbooks, periodicals (purchased by subscription), and newspapers (for general submission).
- Clothing and accessories, like aprons, belts, and undergarments.
- Cosmetics and toiletries include hair restorative products, deodorants, sunburn preventives, and toothbrushes.
- Farming supplies and equipment, like barm shovels, fertilizers, harnesses used to control productive animals, artificial breeding equipment and supplies
- Flowers, seeds, and fertilizers, such as Vegetable seeds, vegetable plants, and fruit trees purchased with food stamps.
- Home sewing, hat, and craft supplies, like buckles, fabrics, and knitting yarns.
- Household goods and supplies include disposable diapers, sanitary pads, and wet wipes.
- Medicine, drugs, and medical supplies, like antiseptics (external use), bed pans, dialysis machines, food substitutes, and pet medicines.
- Miscellaneous, such as coupon books sold to individuals, caskets, burial vaults, markers, interred cremation urns and tombstones for human graves, and flags of the US and the Commonwealth.
- Pets, such as flea collars, pet cremation, and burial services
- Shoes and shoe accessories, like overshoes, safety shoes, and shoe laces.
- Sporting equipment, clothing supplies, and recreational equipment, like gym outfits and bowling shirts.
- Utilities and fuel, such as coal, firewood, kindling, wood pellets, bricks, fuel oil, gas, steam, or electricity purchased for residential use.
Note: The state allows some customers to enjoy a tax exemption from sales tax, such as government organizations, some non-organization organizations, and a few merchants buying goods for resale. These customers must apply for the Pennsylvania Exemption Certificate.
But to collect sales tax, you need a seller’s tax permit. Let’s discover how you can get one.
How to Register for a Pennsylvania Seller’s Permit
You can register for a Pennsylvania Sales, Use, and Hotel Occupancy Retail Tax License online at the Pennsylvania Department of Revenue’s myPath site.
Learn how to register for a sales tax license in every US state here.
Do I Need a Pennsylvania Sales Tax License if I’m Only A Wholesaler?
A wholesaler who makes a purchase to resell it to retailers should apply for a Wholesaler’s Certificate.
However, if the wholesaler also makes retail sales, they are no longer considered a wholesaler and must apply for a Sales Tax License.
Do I Need A Pennsylvania Seller’s Permit if I Only Sell Temporarily in the State?
Yes.
Pennsylvania requires businesses to register for a sales tax license even if they are temporarily making sales in the state.
How to Collect Sales Tax in Pennsylvania
Sales tax in Pennsylvania is collected in two ways:
A. How to Collect Sales Tax on Intrastate Pennsylvania Sales
A sale is considered intrastate if it ships from an origin in Pennsylvania to a buyer’s address in Pennsylvania.
Pennsylvania is an “origin-based” sales tax sourcing state. This means that if you make a sale originating in Pennsylvania and the buyer’s ship-to address is also in Pennsylvania, you would charge the sales tax rate at the sale originating point.
For instance, your business is in Harmony, Pennsylvania, and you make a taxable sale to a buyer in Bethlehem, Pennsylvania. You’d charge the buyer the sales tax rate at your Harmony location.
B. How to Collect Sales Tax on Interstate Pennsylvania Sales
A sale is considered interstate if the taxable item ships from outside Pennsylvania and the seller isn’t otherwise engaged in business in the state.
For sales that don’t originate in Pennsylvania, you’d charge the sales tax rate at your buyer’s location.
For example, your business is in Hoboken, New Jersey, and you make a sale to a buyer in Allentown, Pennsylvania. You’d charge the buyer the Allentown sales tax rate.
Should You Collect Sales Tax on Shipping Charges in Pennsylvania?
Yes.
Shipping charges are subject to sales tax in Pennsylvania.
How to File and Pay Sales Tax in Pennsylvania
When your sales tax filing due date approaches, you can file Pennsylvania sales tax returns in multiple ways.
- File and pay online: File sales tax at Pennsylvania MyPATH. Taxpayers remitting $1,000 or more in sales tax should remit funds via Electronic Funds Transfer (EFT). Taxpayers remitting less than $1,000 can pay through Automated Clearing House (ACH) Debit, Automated Clearing House (ACH) Credit, or credit card.
- File by phone: Telefile is available at 1-800-748-8299 for taxpayers who don’t have computer access
- Let Zamp handle your Pennsylvania sales tax filing and remittance so you never have to look at a sales tax return again!
Learn how to file and pay sales tax in other US states here.
