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Remote sellers,marketplace seller and Economic Nexus

Source: https://www.tax.virginia.gov/remote-sellers-marketplace-facilitators-economic-nexus

Virginia recently enacted economic nexus legislation (House Bill 1722; Senate Bill 1083; and Item 4-14 of the 2019 Appropriation Act), which means having a physical presence in Virginia is no longer a prerequisite for having to collect Virginia sales and use tax. Under the new law, a remote seller or marketplace facilitator has economic nexus if they sell or facilitate the sale of more than $100,000 in annual gross retail sales or 200 or more transactions to Virginia customers.
Remote sellers and marketplace facilitators who meet the new economic nexus standards are required to register with Virginia Tax to begin collecting sales tax starting July 1, 2019. 
You may qualify as a “remote seller,” a “marketplace seller," or a “marketplace facilitator,” or any mix of the 3 classifications depending on your retail sales activities in Virginia. See the corresponding section below to see what you need to do in each role. 

What is a remote seller?

A remote seller is any dealer that, in the previous or current calendar year, either receives greater than $100,000 in gross revenue from retail sales, or engages in 200 or more separate retail sales transactions, or any software provider acting on behalf of such dealer.

Do you sell through a marketplace facilitator only?

If all of your sales in Virginia are conducted through a marketplace facilitator’s platform, you are considered a "marketplace seller" and do not need to register to collect Virginia sales tax. Your marketplace facilitator is responsible for the tax on sales through the marketplace. See the marketplace sellers section for more information.
Do you sell through a marketplace facilitator and another venue, like your own website?
If your annual direct sales to Virginia customers (sales that aren’t made through the facilitator) total more than $100,000 or 200 or more total transactions, you need to register to collect Virginia sales tax. Register online, or complete Form R-1. You will have to begin filing Virginia sales tax returns for your direct sales only. Your marketplace facilitator is responsible for the tax on sales through the marketplace.
Don't sell through a marketplace facilitator at all?
If your annual direct sales to Virginia customers (sales that aren’t made through a marketplace facilitator) total more than $100,000 or 200 or more separate transactions, you need to register to collect Virginia sales tax. Register online or complete Form R-1.

What is a marketplace seller? 

Marketplace sellers are those who contract with marketplace facilitators to sell their products through the facilitator’s platform.

Do you need to register to collect sales tax? 

  • If all of your sales in Virginia are conducted through a marketplace facilitator’s platform, you generally do not need to register to collect Virginia sales tax. Your marketplace facilitator is responsible for the tax on sales through the marketplace. 
  • However, if you also make sales to Virginia customers outside of a marketplace facilitator’s platform, like through your own website, and you meet the $100,000 or 200 transactions threshold for remote sellers, you will need to register to collect sales tax on your direct sales. See the remote sellers section for more information.


 

 


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