GA Sales Tax 101 States

Georgia Sales Tax Guide for Business

by Mark Faggiano

Georgia sales tax

Confused about whether you need to collect sales tax from buyers in Georgia? It’s understandable, considering every state has vastly different rules on the subject. To help you out, we’re covering the ins and outs of every state, and today we’re focusing on Georgia.

You’re a merchant living anywhere but Georgia

Does your business exist outside of Georgia and you otherwise have no sales tax nexus in the state? Congrats, you’re in the clear, and shouldn’t have to worry about charging sales tax to buyers from Georgia.

You live and/or operate your business in Georgia

In this case your business physically exists or you otherwise operate in Georgia. For example, you have a successful coffee mug business in Moultrie where you sell your items. This means you’re required to collect and remit sales tax to the state.

Georgia is a destination based state, so your primary concern is where the customer is. For instance if your business is physically in Moultrie but gets an order from a customer in Tifton, you charge them the sales tax rate in Tifton.

The state rate for Georgia is 4%. However, there are various rates for each county and some local areas that add additional sales tax. Cobb County adds on 2% for a total of 6%, for example. So if your customer lives in Cobb County, you would collect 6%, even if you live in a county like Stewart with 8% total.

On top of that, the city of Atlanta (located in both Fulton and DeKalb counties) has a separate 1% sales tax. You can find out more on that on the DOR website.

You live-out-of-state but have nexus in Georgia

In this example your business physically exists out of the state but you have sales tax nexus due to a warehouse, employee or other reason. If this is the case, then you must collect and pay sales tax to the state of Georgia.

Again, Georgia is a destination based state, so your only concern is where your customers live. The base rate of the state is 4%, but individual counties and local areas will tack on extra percentages, so be sure to look at the tax rate table first.

Here’s what you need to know about Georgia nexus from the DOR website:

Who Must Register for Sales and Use Tax?

Every person, partnership, limited liability entity, firm, or corporation who sells, uses, distributes, or manufactures tangible personal property in Georgia must register for sales and use tax if:

• They import goods from any state or foreign country for sale at retail, or for use, consumption, distribution, or storage in Georgia.

• They lease or rent tangible personal property in Georgia.

• They maintain an office, distribution house, sales room, warehouse, or inventory in Georgia.

• They otherwise qualify as a “dealer” as defined in the Official Code of Georgia Annotated, Section 48-8-2.

georgia nexus

Filing sales tax in Georgia

If you must collect sales tax in Georgia, first you must register your business with the state online. You can also grab the necessary forms from the DOR website and fax them in to the Registration and Licensing at 404-417-4318 or 404-417-4317.

The forms must be filed before the 20th following the period for which the tax is due. Georgia is on primarily a monthly basis but the DOR may permit the filer to file less frequently if he or she has a fairly low sales volume in the state.

If you need to file a sales tax return in Georgia, TaxJar has your back. You can now enroll in AutoFile for the state of Georgia and we’ll automatically file your sales tax return for you! Find out more about AutoFile.

Sales tax on shipping

In Georgia, shipping is considered a taxable charge. From the Georgia Statutes and Codes website:

“Delivery charges” means charges by the seller of personal property or services for preparation and delivery to a location designated by the purchaser of personal property or services including, but not limited to, transportation, shipping, postage, handling, crating, and packing.

Georgia shipping

Summary: Georgia is a pretty average destination-based state with lots of tax rates

Georgia is a destination based state, which means you only need to worry about charging the sales tax rate where your customers are located. If your business exists outside the state and you have no nexus, you don’t have to collect. If your business is in the state or you otherwise have nexus (such as caused by a warehouse or employee), you must collect sales tax.

Georgia’s state rate is 4%, but each of the state’s 159 counties has its own rate to add on. Additionally, the city of Atlanta has a separate 1% tax. Before collecting you must register your business then submit payments before the 20th of the month following the period in which the taxes are due. While generally it’s on a monthly basis, the Department of Revenue may make an exception for sellers to pay annually or semi-annually.

  • billy

    when buying online from out of state does ill. buyer pay tax

  • The only instance you would collect sales tax from a customer in IL is if your company has nexus in IL and you are selling a taxable product.

  • Sanaea

    Hi Mark,
    I am starting an online store that sells cases for iphones. I am going to use a supplier in Atlanta, Georgia who will drop-ship the items to the customer.Since I do not own the facility and will only be sending them orders I get from my online store, would I be required to collect sales tax in that state?
    Please Help!
    Thanks.

  • Hi Sanaea,

    Drop shipping and sales tax can get complicated. I can point you to what we’ve previously written on drop shipping, but recommend you contact an accountant for specific questions about your situation.

    http://taxjar.wpengine.com/drop-shipping-sales-tax/

  • Yoshee

    Hi Mark,

    I’m starting a portable restroom business and will be renting them in and around the city of Atlanta. I will charge for delivery/pickup, setup and cleanup. Do I charge sales tax on the rental? Also, do I need to charge any taxes on the setup and cleanup. Lastly, please advise what sales tax rate should be use.

    Thanks,
    Yoshee

  • Jennifer

    Hello Mark,

    I own an inflatable company where I delivery a bounce house to a customers house. My question is do I send the taxes to the county that my business is located or where the customer lives.
    Thanks so much,
    Jennifer

  • Hi Jennifer, This one is tricky. I recommend contacting the Georgia Department of Revenue or a sales tax pro. That said, if you collect the money at your office, then you would most likely charge the rate at your business location.

    Here’s our list of reputable sales tax pros: http://www.taxjar.com/sales-tax-accountant-directory/

  • Denise E Miles

    If my business is in GA but I sell online to out of state customers, what guideline do I use for taxes?

  • You only have to collect sales tax from customers in states where you have sales tax nexus. So if you only have sales tax nexus in Georgia, then you only have to charge sales tax to customers in Georgia. Georgia is a destination-based sales tax state for in-state sellers, so you would charge sales tax at the rate of your buyer’s ship-to address.

    Here’s more about what creates nexus: http://taxjar.wpengine.com/sales-tax-nexus-definition/

  • Tasha

    So if i sell strictly online and i do not have a physical location in the state of GA, I do not have to charge sales tax?

    • Hi Tasha,

      Your home office or warehouse is considered your physical presence. Even if you work from a computer at your kitchen table, that’s considered a physical presence accodring to state departments of revenue.

  • Andrew

    Hello Mark,

    If I am giving a discount on products, do I charge sales tax based on the original cost of the item, or of the subtotal after the discounts have been given?

    Thanks in advance
    Andrew

    • Hi Andrew,

      From our understanding, you charge sales tax on the amount your customer actually pays you.

  • Benjamin Ferguson

    Are service companies subject to sales tax in Georgia? Or can they “absorb” the tax?

  • Denise Greene

    If I incorporate In Georgia and then sell items built in Georgia to other businesses out of state, do I need to charge sales tax to those businesses? I will not have any locations anywhere else except for Georgia and will be selling custom-designed furniture to restaurants in other states.

  • joy

    Do theater productions have to pay sales tax or are they categorized as a service? What type of business falls under GA Amusement Sales Tax of 6.2% (which type of business must pay this)?

  • Cindy

    Do we have to charge sales tax on fees? We do leasing and financing and charge a documentation fee to prepare the lease documents and a UCC filing fee when we file the lien on the equipment. Should those fees be taxed?

  • Hi Cindy,

    I recommend contacting a CPA about this one. Here’s a list of vetted professionals: http://www.taxjar.com/sales-tax-accountant-directory/

  • Dana Webb

    can sales tax be charged on labor (prep charges) in the state of georgia

  • Alice C.

    We are a California based company but have a warehouse in Atlanta. Does this mean we need to charge sales tax to all buyers in GA, no matter where we ship the merchandise from? Even when we ship the merchandise from “CA” to GA?

    • Hi Alice,

      If you have sales tax nexus in Georgia then you need to charge sales tax to *all* buyers in Georgia, regardless of where the inventory comes from.

  • $3743293

    Are edible items sold on line to out of state customers taxable? Are health supplements sold on line to out of state customers taxable?

  • You only have to collect sales tax from customers in states where you have sales tax nexus. And taxability of products depends on the state. Here’s more about nexus: http://taxjar.wpengine.com/sales-tax-nexus-definition/

    And more about sales tax in general: http://www.taxjar.com/guides/intro-to-sales-tax/

    I hope this helps!

    • Mike7106

      Thanks.

  • curious

    If I pay GA sales tax when I purchase an item and then later sell that item in my store, do I report that on the EXEMPT sales line on the tax form?

    • Unless there’s some other extenuating circumstance (like you’re selling to a non-profit or selling the item to a person in a state where you don’t have sales tax nexus) then you’d still be required to charge sales tax on the item, despite having paid sales tax on it when you bought it. Sales tax is charged on the transaction, not the item itself. If you plan on buying many items for resale, you can get a resale certificate from the state or states where you have nexus. I hope this helps!

  • Leann

    Are the following services taxable: Mileage for employees, transportation of product and inventory sales? Regarding inventory, if a business purchases inventory in Cobb county and sells and delivers it to a consumer in DeKalb county, which tax rate does the consumer pay for? Cobb or DeKalb? Also, does the consumer pay two different sales taxes, 1 for inventory and 1 for delivery? Thanks.

  • RALPH FUSCO

    Are health club membership fees taxable for sales tax in Georgia?

  • John

    When obtaining a copy of your medical records, you are charged certain fees that are regulated by the state of Georgia. I know the actual paper copies and shipping are taxable but what about the Search & Retrieval fee? Thanks, John

  • El Cascarrabias

    I purchased a Rolex in Florida. Did not pay Florida sales tax as I did not take possession until it was shipped to me in GA. I filled out a form verifying that I lived in GA at the jewelry store where I bought it. Does Georgia require that I pay GA sales tax on this?

    • You are technically supposed to pay Georgia use tax on any items you buy for use in Georgia but which you didn’t pay sales tax on. These purchases are supposed to be reported on your Georgia state income tax returns. That said, this is hard to enforce and many consumers don’t even know about it. Here’s more fro the Georgia DOR: http://dor.georgia.gov/what-subject-sales-and-use-tax#field_related_links-486-1

      • El Cascarrabias

        Thanks . . . I think.

  • Brandy Dunn Verner

    Great article! I am from Georgia, where I started a business selling personalized gifts online a couple of years ago. Since then, I have been paying sales tax on orders shipped to customers in GA. However, last September I moved to Florence, Italy and am running the business from here. I use several manufacturing partners (none of which are located in GA) to produce my products and they ship the items directly to my customers. I no longer have any physical presence in the state, but I still have a PO box, which I use as my business address. (My mom checks it periodically.) Does this constitute enough of a presence in the state to be required to collect and pay sales tax? Also, I have a freelance virtual assistant who does some admin work for me during busy times of the year. She happens to live in GA, but she does not do sales or have an office for my business. Does that affect my physical presence in the state? I would appreciate any insight you can offer!

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