How do I collect sales tax?
A registered business that will be collecting sales tax, remitting use tax, or exemption certificates, will receive a Certificate of Authority for Sales Tax by mail. The Certificate permits a business to collect sales tax and to use exemption certificates. It must be displayed prominently at the place of business.
Buying for Your Business - Using Exemption Certificates
Note that each of the forms mentioned under this heading can be found on the Department of the Treasury’s website:https://www.state.nj.us/treasury/
When you buy materials (inventory) for resale, or materials which will become part of the product sold, businesses are not required to pay sales tax—provided they issue a New Jersey Resale Certificate to the supplier.
There are two different resale certificates:
- Form ST-3, which is used for in-state suppliers
- Form ST-3NR which is for used for out-of-state suppliers
Certain production machinery and most packaging supplies are exempt from sales tax because of their intended use. You may use an Exempt Use Certificate (Form ST-4) when purchasing these items and pay no sales tax. Other common uses of the Exempt Use Certificate are listed on the back of the certificate.
NOTE: There are special exemption certificates for use by registered exemp t organizations (FORM ST-5) and contractors doing work for exempt organizations (Form ST-13).
Selling Your Product – Collecting Sales Tax
If selling taxable items or services in New Jersey, businesses are required to collect and remit a sales tax to the state. As of January 1, 2018, the sales tax rate was 6.625 percent. To learn more about the New Jersey Sales and Use Tax and to find the current rate, visit the Division of Taxation’s website at https://www.state.nj.us/treasury/taxation/su.shtml.
Businesses should not collect tax if the purchaser issues you a valid New Jersey exemption certificate or, in certain instances, if your product is delivered to the buyer out- of-state.
If you are unsure whether an item you are planning to sell is taxable, information on the taxability of intra/inter-state sales is available by calling the New Jersey Business Action Center 866-534-7789.
Remote Sellers
Since November 1st, 2018, a remote seller that makes a retail sale of tangible personal property, specified digital products, or services delivered into New Jersey must register, collect, and remit New Jersey sales Tax if the remote seller meets either of the following criteria
- The remote seller’s gross revenue from sales of tangible personal property, specified digital products, or services delivered into New Jersey during the current or prior calendar year, exceeds $100,000 or
- The remote seller sold tangible personal property, specified digital products, or services delivered into New jersey in 200 or more separate transactions during the current or prior calendar year
A remote seller that is above one or above of the above thresholds should go to the Division of Revenue and Enterprise services at
hhtps://www.njportal.com/DOR/BusinessRegistration
A remote seller that does not meet either of these criteria does not have to register with the Division of Taxation to collect and remit New Jersey Sales Tax.
For additional information on Sales through a Marketplace, see Technical Bulletin 83
(https://www.state.nj.us/treasury/taxation/pdf/pubs/sales/tb83.pdf)
Filing Sales Tax Returns
You must file a New Jersey Sales and Use Tax Quarterly Return Form (ST-50) every three months, (even if no tax was collected during that particular quarter) in that particular quarter no tax was collected. Businesses that collect a sales tax more than $500 per month, or that collected more than $30,000 in the previous calendar year, must also file monthly returns (Form ST-51).
NOTE: Seasonal businesses are required to file both monthly and quarterly returns for the period of time in which they conducted business, regardless of the amount of tax due.
