Vermont Sales Tax Filing Update June 2019

What's changing in Vermont?

Vermont has passed a law requiring Marketplaces to collect and remit sales tax on sales facilitated through the marketplace effective June 1, 2019.

  • Amazon began this collection on June 7, 2019.
  • Etsy will begin this collection on July 1, 2019.
  • eBay will begin this collection on July 1, 2019.
  • Walmart will begin this collection on July 1, 2019.
  • As of June 19, 2019, we have not yet received confirmation that any additional carts currently supported as Marketplace Facilitators in TaxJar's Reporting will begin this automatic collection. 
  • We will update this article with more details as our research team receives more specific confirmation and guidance from the state's DOR as well as the currently supported Marketplace Facilitators.
  • You can view the state's guidance document here.

How does this affect me?

If you sell through a Marketplace that has agreed to begin collection in this state, you'll see sales tax collected in Vermont for sales on and after the above effective dates on your TaxJar Dashboard and on your Vermont Transactions page.

  • If you have never set up a filing frequency for Vermont in your account's State Settings, our system will default the state to a monthly frequency and due date on your Dashboard after we see tax collected there. (We default to a monthly frequency and due date if you haven't yet adjusted any frequencies on your end, but the state itself would ultimately determine your exact filing frequency.) 
  • If you are currently opted in to receive email reminders for your sales tax due dates, you'll also see Vermont listed as a state where you have an upcoming monthly return due in those emails.

I've never registered for a Vermont license. Do I need to register for a sales tax license in Vermont now?

If you are a retailer with a physical presence in Vermont or you are a remote seller who has crossed the economic nexus/small seller threshold for Vermont of  $100,000  in gross revenue, or at least 200 separate sales transactions in Vermont in the preceding twelve-month period, then you will need to register for a Vermont sales tax license.
  • If you've imported your sales across all platforms into your TaxJar account, you can determine if you have economic nexus in the state by running the Sales & Transactions Checker.
  • If you do not meet any of the criteria that creates nexus in Vermont, you won't need to register for a sales tax license in this state.

I have already registered for a license in Vermont but all of my sales are Marketplace-only sales. Should I cancel my existing registration?

The state has not provided guidance on this question.  Registered sellers with nexus should remain registered.

Is inventory stored in a participating Marketplace Facilitator's warehouse still viewed as a physical presence that requires the seller to register (or remain registered)?

Yes.  Marketplace Seller owned inventory creates sales tax nexus and will require the seller to be registered.

Do I need to collect taxes on my Vermont sales on other platforms?

Yes. If the seller would otherwise be required to register and collect sales tax in Vermont then the sales tax should be collected on sales outside of the marketplace.

Do I still need to file returns in Vermont?

Yes. Once you register for a license, you will be required to file a return based on the frequency the state has assigned you.
  • If you've previously registered, the state expects you to remain registered and continue to file returns.
  • Monthly filers may be able to reduce frequency to quarterly and should consult directly with the state to request this change. 

I still need to file returns in Vermont. How do I do this without paying double tax on the sales that were collected and remitted by my Marketplace?

When you file, you'll need to take an exemption for “Non-taxable Sales” on Line 2 SUT451 or in the e-file form in your MyVTax account.
MyVTax

Paper form - SUT451

  • Please note, because Amazon began collection on June 7, 2019 sellers who have nexus in this state will be responsible for remitting sales tax for taxable transactions prior to Amazon's collection start date. (June 1-6, 2019).
  • If all of your sales are Marketplace sales, once you deduct the marketplace sales, you will need to file a $0 return.
  • If you make sales on other platforms in addition to the Marketplace, you'll need to make sure you remit the tax you collected for those sales when you file.
  • If you're enrolled in AutoFile for Vermont, our system will handle the Marketplace sales deduction process automatically.

How does this affect my TaxJar Report for Vermont?

For Amazon transactions, your Vermont Sales Tax Report will be updated in July 2019 (when returns for sales after June 1, 2019 are due) to specifically reflect sales that had tax collected and remitted by Marketplaces that are supported as Marketplace Facilitators in TaxJar Reports.

For Etsy, eBay and Walmart transactions, your Vermont Sales Tax Report will be updated in August 2019 (when returns for sales after July 1, 2019 are due). 

Our team is still investigating how this update will affect sellers. Please note, we will continue to update this article with more details as our research team receives more specific confirmation and guidance from the state's DOR as well as the currently supported Marketplace Facilitators.
  • This article will be updated later in July 2019 with more specific details for eBay and Etsy if applicable. 
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