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Can I collect sales tax from customers in different states without violating tax laws in Connecticut? What are the requirements?

Requirements for Collecting Sales Tax from Customers in Different States without Violating Tax Laws in Connecticut

If you are making sales to customers in different states, you may be subject to the sales tax laws of those states. The requirements for collecting sales tax from customers in different states vary depending on the state. Some states require retailers to register for a sales tax permit, while others do not. Additionally, some states require retailers to collect sales tax on all sales made to customers in the state, while others only require sales tax to be collected on sales made to customers in the state if the retailer has a physical presence in the state.

In Connecticut, retailers are required to collect sales tax on all sales made to customers in the state, including sales made to customers in Connecticut from outside the state. There are no exemptions for out-of-state retailers. However, Section 12-411a of the Connecticut General Statutes, which implemented a conditional tax on out-of-state mail order companies for sales of merchandise shipped to purchasers in Connecticut, was repealed effective July 1, 1989, and applicable to sales from outside the state to destinations in the state on or after that date [1.2].

Collection of Use Tax by Certain State Contractors

It is worth noting that for any contract for provision of tangible personal property to the state entered into on or after August 16, 2003, each department head shall enter into an agreement with the contractor pursuant to which such contractor shall agree, on its own behalf and on behalf of each affiliate, for the term of the state contract, to collect and remit to the state on behalf of its customers any use tax due to the state under the provisions of this chapter for items of tangible personal property sold by the contractor or by any of its affiliates in the same manner as if the contractor and its affiliates were engaged in the business of selling tangible personal property for use in this state and had sufficient nexus with this state to be required to collect use tax due to the state [1.3].

Conclusion

If you are making sales to customers in different states, you should consult the sales tax laws of those states to determine if you are required to collect sales tax from your customers. In Connecticut, retailers are required to collect sales tax on all sales made to customers in the state, including sales made to customers in Connecticut from outside the state. However, the conditional tax on out-of-state mail order companies for sales of merchandise shipped to purchasers in Connecticut was repealed effective July 1, 1989, and applicable to sales from outside the state to destinations in the state on or after that date.

Source(s):
Jurisdiction

Connecticut