Sales and use tax in the State of Idaho can include both State and Local rates depending on where you are and there are a number of factors to consider when determining the rate you should charge for a transaction made.
In this guide we will discuss what rates are charged, how you determine if you should be collecting sales tax in Idaho, the process of registering for and acquiring a permit, and how and when to remit payment to the state for the sales tax you collected.
The following sales and use tax rates apply in Idaho at the state and local level:
Because of the way the system is designed, the sales tax rates can be quite complex and can be charged at the county, city, school, or transportation level depending on the needs of that region.
For those that do not wholly operate in Idaho, it’s important to determine before proceeding if you have sales tax nexus in the state and will be required to collect sales tax. There are a number of factors that may require you to collect sales tax in Idaho including:
For a more detailed breakdown of how Idaho establishes nexus for sales tax, read their regulations here.
Idaho charges sales tax on physical goods and some services with only a handful of exemptions based on certain circumstances.
Before assuming exception to any of the sales tax applied in Idaho, be sure to review the documentation on the State Tax Commission’s website.
The State of Idaho requires that all businesses that must collect sales tax register with the state. You can do so through the State Tax Commission’s website using the IBR-1 form. This form is a combined form for the Tax Commission, Industrial Commission and Idaho Department of Labor and applies for both in state and out of state sellers. If you are out of state and the remainder of the form’s purposes do not apply to you, there are detailed instructions online for how to complete it.
After completing the IBR form, you will receive your account number and permit for payment within 10 days. This will provide you with the Idaho Seller’s Permit needed to do business in the state.
You will pay Idaho sales and use tax by:
Your filing frequency will be determined at the time you receive your permit. It will be related to the total liability you expect to have to the state. The deadlines for each frequency are listed below.
Quarterly: For those required to file quarterly, the following due dates apply:
|January – March (Q1)||April 20|
|April – June (Q2)||July 20|
|July – September (Q3)||October 20|
|October – December (Q4)||January 20|
Monthly: For those required to file monthly, the following due dates apply:
There are penalties for both late filing and late payment of Idaho Sales and Use Tax. If you fail to file on time, you will pay the greater of either 5% of the tax due per month (with a maximum fine of 25%) or $10. This applies for those with zero returns as well – there will be a $10 fee for not filing your zero return.
For those that pay their sales and use tax remittance late, you will be charged 0.5% of the tax due per month late with a maximum penalty of 25%.
If you operate or do business in Idaho and are interested in software or tools to help you reduce the cost and time of calculating sales tax due in the state, consider TaxTools. The TaxTools software offers a range of features such as sorting, data reviewing, and rate calculation to streamline the process of determining what should be collected and from whom. It can be integrated with your existing ecommerce solution or used as a standalone tool for your site. Contact us today to learn more or to sign up for a free trial.