It is critical to understand the state’s regulations for sales and use taxes if you own a business in West Virginia. Businesses are required to pay two different types of taxes to the WV State Tax Department: sales tax and use tax. The use tax and its effects, however, are not well known to many business owners. In this post, we’ll go over what use tax in West Virginia is, who is responsible for paying it, how it differs from sales tax, and how to register for both taxes in West Virginia.
In West Virginia, a tax known as sales tax is levied on the purchase of goods and services. The tax must be collected and sent to the state government by the vendor. Use tax, on the other hand, is a fee levied on purchases acquired outside of West Virginia but put to use there. The use tax is charged at the same 6% rate as the standard sales tax.
Use tax on purchases made outside of West Virginia is your responsibility if you own a business there. For instance, you are responsible for use tax if you buy equipment from a retailer based outside of West Virginia but use it for your company there. A complete record of all purchases made outside the state, including invoices, receipts, and shipping papers, must be kept.
Sales tax is levied at the point of sale, whereas use tax is levied after the transaction, and this is the main distinction between the two taxes. While use tax is paid by the buyer, sales tax is collected by the seller. Additionally, use tax is only applied to purchases made outside of West Virginia and is not applied to any transactions within the state.
You must submit an application to the West Virginia State Tax Department in order to register for sales and use tax. You can submit the application in person, via mail, or online. Information about your company, such as your business name, address, and federal tax ID number, must be provided. You will receive your sales and use tax permit after your application has been processed, enabling you to collect and submit sales and use tax in West Virginia.
In conclusion, it is crucial for each West Virginia business owner to comprehend use tax. You must pay use tax as a business owner on any purchases made outside of West Virginia but utilized there. You may prevent fines and make sure you are in compliance with state tax rules by registering for the WV sales and use tax and maintaining accurate records.