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

Requirements for Collecting Sales Tax from Customers in Different States in Utah

If you are selling goods or services to customers in different states, you may be required to collect sales tax from those customers. However, the requirements for collecting sales tax vary by state. In Utah, you are generally required to collect sales tax on sales made within the state.

According to UTCO 59-12-106, it is unlawful for any person required to collect a tax under this chapter to engage in business within the state without first having obtained a license to do so. The license shall be granted and issued by the commission and is valid only for the person in whose name the license is issued. The commission shall review an application and determine whether the applicant meets the requirements of this section to be issued a license.

If you are selling goods or services to customers in other states, you may be required to register for a sales tax permit in those states and collect sales tax from customers in those states. Each state has its own rules and requirements for sales tax collection, so it is important to research the requirements for each state where you have customers.

Additional Information

Utah allows counties, cities, towns, or metro townships to impose a sales and use tax under UTCO 59-12-203. These entities may enter into agreements authorized by Title 11, Chapter 13, Interlocal Cooperation Act, and use any or all of the revenue collected from the tax for the mutual benefit of local governments that elect to contract with one another pursuant to Title 11, Chapter 13, Interlocal Cooperation Act.

Under UTCO 59-12-108, a seller may retain a portion of the sales tax collected as compensation for collecting and remitting the tax. The amount of compensation is based on the amount of tax collected and remitted. Certain amounts of the sales tax collected are allocated to local taxing jurisdictions.

Conclusion

In summary, if you are selling goods or services to customers in different states, you may be required to collect sales tax from those customers. In Utah, you are required to obtain a license to engage in business within the state. However, the requirements for collecting sales tax vary by state, so it is important to research the requirements for each state where you have customers. Additionally, Utah allows counties, cities, towns, or metro townships to impose a sales and use tax, and a seller may retain a portion of the sales tax collected as compensation for collecting and remitting the tax.

Jurisdiction

Utah

• General