Almost all retail sales of tangible personal property in Massachusetts are subject to a sales tax. On the other hand, some businesses and people are excluded from paying sales tax on their purchases. These include of governmental bodies, nonprofit organizations, and a few other entities. This article will cover how to apply for a Massachusetts sales tax exemption, the small company exemption, whether services are subject to sales tax, who is liable for paying sales tax, and what a Massachusetts tax-exempt certificate is.
You must submit an application for a tax-exempt certificate to be granted a sales tax exemption in Massachusetts. The Massachusetts Department of Revenue (DOR) has issued this certificate, which is good for two years. You must complete Form ST-5, which is available on the DOR website, in order to apply for a tax-exempt certificate. You must fill out the form with details about your company or group, including your tax ID number, the nature of your organization, and the justification for the exemption.
Small businesses in Massachusetts are excused from paying taxes if their yearly sales are less than $100,000. Sales tax is not required to be paid on the acquisitions of tangible personal property made by small firms that fall under this threshold. You must submit Form ST-13A to request a tax-exempt certificate in order to be eligible for the small company exemption. The DOR website also has access to this form.
In Massachusetts, there is no sales tax on the majority of services. There are a few exceptions, including those for transportation, telecommunications, and specific computer services. Consult the DOR website or get in touch with a tax expert if you’re unsure if a specific service is subject to sales tax. Who is responsible for paying the sales tax, the buyer or the seller?
Sales tax collection and submission to the state in Massachusetts fall under the purview of the vendor. The buyer is nonetheless liable for paying the tax to the state even if the seller does not successfully collect it from them.
The Massachusetts Department of Revenue can certify that a certain business or person is exempt from paying sales tax on purchases using a tax-exempt certificate. To avoid paying sales tax, the vendor must see this certificate when the buyer makes the purchase.
In conclusion, a tax-exempt certificate from the Department of Revenue must be requested in order to qualify for a sales tax exemption in Massachusetts. The small business exemption is available to small firms that meet specific requirements. In Massachusetts, there is no sales tax on the majority of services. Sales tax is the buyer’s responsibility to pay if the seller doesn’t collect it; it is the seller’s responsibility to collect and return sales tax to the state. A tax-exempt certificate is a legal declaration that a specific business or person is exempt from paying sales tax on purchases.