Bigcommerce Sales Tax 101

The BigCommerce Seller’s Guide to Sales Tax

by Mark Faggiano

BigCommerce Sales Tax Guide from TaxJar

What if we told you that setting up your online store with a BigCommerce shopping cart was the fun part? Once your store is actually up and running, it’s time to handle the business side of your eCommerce business. And one of the more time consuming and perilous aspects of an online business is dealing with sales tax.

TaxJar integrates with your BigCommerce shopping cart to make sales tax compliance simple. But a lot of sellers still have questions about the basics of sales tax.

For that reason, we put together a guide to what BigCommerce sellers need to know about sales tax:

Step 1: Determine where you have sales tax nexus

Forty-five states and the District of Columbia require merchants to collect sales tax from buyers. The good news is that only merchants who have “sales tax nexus” in a state must collect. The bad news is that nexus means “significant presence” and can be created by anything from an office, an employee, storing goods in a warehouse or selling at a tradeshow.

Your first step when it comes to sales tax compliance is to determine where you have sales tax nexus and then proceed on to…

Step 2: Register for a sales tax permit

If you have sales tax nexus in a state you are required to register for a sales tax permit in order to begin collecting sales tax in that state. In fact, some states consider it unlawful if you collect sales tax without first obtaining a permit.

To file for a sales tax permit, visit the Department of Revenue website of any states where you have sales tax nexus. For quick links and more information about sales tax in each state, check out this map. Keep in mind that some states will charge for a sales tax permit while others don’t.

When you’ve filed for a sales tax permit, the state will tell you how often and when they want you to file a sales tax return and remit sales tax. This is usually either monthly, quarterly or annually. Don’t be surprised if, when you register for a sales tax permit in more than one state, they want you to file sales tax at different times. One stay may want you to file every month while another may only want to hear from you once per year. Every state is different in how they govern sales tax.

Wisconsin sales tax permit

Every state’s sales tax permit application is different. This is Wisconsin’s.

Step 3: Collect sales tax

Next it’s time to set up your BigCommerce store to collect sales tax. If you only have sales tax nexus in one state and don’t have any special sales tax needs (such as tax exempt items or customers), then you can let BigCommerce automatically configure sales tax for you.

If your sales tax is a little more complex, though, you have a little work to do to get your BigCommerce shopping cart set up.

To do this, you’ll need to go into your BigCommerce store Settings > Tax and set up “Sales Tax Rates & Zones.”

This is fairly easy if you live or have nexus in an origin-based sales tax state where you only have to charge your local sales tax rate to buyers. But if you live or have nexus in a destination-based state, you will have to set tax rates for each local area. Fortunately you can use TaxJar’s Sales Tax Calculator to look up sales tax rates in each zip code.

Find out more about setting up sales tax in BigCommerce at the BigCommerce tax settings support page.

Not only can you configure BigCommerce to collect sales tax from buyers in multiple states, you can also configure your sales tax collection however you want, including:

  • Include/Exclude tax on products
  • Control over which address the tax is based from (shipping, billing, or store location)
  • Ability to create custom tax classes allowing you to have specific tax rates for groups of products

Find out more about setting up sales tax in BigCommerce at the BigCommerce tax settings support page.

Step 4: Calculate how much sales tax you’ve collected

Now that you’ve configured your sales tax settings in BigCommerce and collected sales tax from customers, it’s time to figure out how much you’ve collected in order to get ready to file a sales tax return.

This is where TaxJar comes in handy. You can integrate your BigCommerce account with TaxJar and we will pull in all of your tax collected and configure it in the format that your state wants to see.

Here’s how to integrate your BigCommerce and TaxJar accounts:

Click the “Apps” icon in the left navigation of your admin panel.

Bigcommerce install TaxJar

You’ll see TaxJar is one of only about 20 apps available to BigCommerce customers. Just click the TaxJar app and you’ll get a nice big blue button that you can click to install.

TaxJar in the BigCommerce App Store

That’s it. You’re done. From here, you are set up with TaxJar and ready to automatically sort and report your sales tax totals.

TaxJar is especially useful if you sell on more channels than just BigCommerce. Integrate channels like eBay, Amazon, Etsy, PayPal, Square, Shopify, Woo Commerce and Magento with TaxJar and we’ll pull in all of you sales tax collected so you don’t have to tediously run reports one by one by one.

Another strike against trying to manually file sales tax is that many states require you to go the extra mile when filing. They don’t only want to know how much sales tax you collected from buyers in the state, they want to know how much you collected form buyers in each city, county or special taxing district. TaxJar will prepare all of this for you so you don’t have to pore over every sales tax transaction to figure this mess out.

Once you’ve figured out how much you collected from buyers in each state, next it’s time to:

Step 5: File sales tax

It’s show time. When you registered for a sales tax permit your state gave you sales tax filing due dates.

You have some choices here. You can file on paper and send your filing in by mail (archaic and difficult), you can file online at your state’s department of revenue (much easier, and many states even require this) or you can let TaxJar AutoFile your sales tax for you.

With AutoFile, TaxJar files and remits your sales tax turns for you while you do something else – like run your BigCommerce store. After you’re set up with TaxJar, there’s no need for you to do anything else. We’ll also take advantage of any state sales tax discounts that may be eligible for, and remit them right back to you. We’ll never let you leave free money on the table!

Also keep in mind that some states require all merchants registered for sales tax to file a sales tax return even if you didn’t collect sales tax over this period. See a list of states that require these “zero returns” here.

Step 6: Rest!

Congrats! You’ve put a lid on sales tax. Of course, we realize you may have more questions about BigCommerce sales tax, so if you do, start the conversation in the comments!

  • hfm2015

    Do you support multiple bigcommerce stores? How would I connect 2 BC stores?

    • Hi there,

      For now we only support a single BigCommerce connection.

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