Facts you should know about Tax Shark
Non-employees may be used to assist clients in a similar way. For sales and use tax purposes, a technology hardware company that uses a local resource to repair or conduct other maintenance for its customers is considered to have generated nexus by using an affiliate. It makes no difference to the states if the individual delivering the service to the customer is an employee of the company or not. The mere fact that the individual is present in their state and providing a service for an out-of-state company is enough to establish a nexus for the out-of-state company. Have a look at Tax Shark for more info on this.
When calculating their sales and usage tax nexus footprint, technology companies should include non-selling activities such as installation and maintenance/support services, as well as services rendered by a third-party representative. There’s a common misconception that if a business has income tax nexus, it also has sales tax nexus. The tale comes to a close. This is right, but only in part. The second half of the statement is that a business may have sales tax nexus without getting income tax nexus. The sales tax threshold is even smaller than the income tax threshold. Soliciting transactions, for example, is commonly considered a sales tax nexus-creating practise, although the same activity would not create income tax nexus on its own (See P. L. 86-272). Since nexus has not been established for income tax purposes, even the most well-intentioned CPA firms are likely to believe that sales and use tax nexus does not exist. This is not intentional; rather, it is the product of a lack of understanding of sales and use tax laws. Out-of-state retailers and sellers who have a physical presence in and sell or lease taxable tangible personal property or taxable services are required to register and collect sales and use taxes. Pa. Code 61 56.1; Pa. Statute Ann. 72 7202; Pa. Statute Ann. 72 7237(b); Pa. Statute Ann. 72 7202; Pa