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“The statewide sales tax for businesses in West Virginia is 6%”

What Does West Virginia Sales Tax For Businesses Mean?

The state of West Virginia has a pretty straightforward sales tax. In addition to county taxes or local city taxes, the state collects a base state sales tax, which varies greatly depending on which jurisdiction you are in. These local tax rat es would be on top of the states. West Virginia’s tax law, like that of every other state, is a complex system with numerous moving elements. Knowing the fundamentals of West Virginia’s tax system is the first step toward understanding it.

How Much Is The Virginia Sales Tax For Businesses?

The statewide sales tax rate in West Virginia is 6%, and it has been in effect since 1933.

Municipal governments in West Virginia can also levy a local-option sales tax, which can range from 0% to 7% across the state, with an average local tax of 0.246 percent (for a total of 6.246 percent when combined with the state sales tax). West Virginia law allows for a maximum local tax rate of 1%.

West Virginia Sales Tax

Threshold Limit

6%

$100,000 economic sales threshold limit and 200 transaction threshold limit

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Read More: Maine Sales Tax 2022 For Businesses: A Complete Guide

Do You Need To Collect Sales Tax in West Virginia For Your Ecommerce Business?

Sales tax is levied in West Virginia on the sale of tangible items and some services. The vendor is responsible for collecting the tax and remitting it to the appropriate state tax authorities. Therefore, the seller is effectively acting as a collector.

Start by completing the following three questions to see if you need to collect sales tax in West Virginia:

  • Have you established a nexus in West Virginia?
  • Do you sell taxable goods or services to residents of West Virginia?
  • Do your customers have to pay sales tax?

If you answered yes to all three questions, you must register with the state tax authorities, collect the correct amount of sales tax per transaction, file returns, and remit the money to the state. Now, the question arises: what type of goods and services are taxable under West Virginia sales tax? Let’s see.

What Types of Goods & Services Are Taxable Under West Virginia Sales Tax?

The taxability of certain transactions (such as services and shipping) varies by state, as do laws on whether excise taxes or installation costs included in the purchase price are liable to sales tax as well.

  • Traditional Goods & Services

Physical items, such as furniture, home appliances, and automobiles, are all subject to sales tax in West Virginia. Prescription drugs, groceries, and gasoline are all tax-free purchases.

  • Digital Goods & Services

Anything that is provided electronically, such as an album downloaded from iTunes or a video purchased from Amazon, is considered a digital good or service. Businesses in West Virginia are not required to collect sales tax on digital goods or services. However, there is one exception to this rule in West Virginia. On pre-written computer software that is sold online, businesses must collect sales tax.

Additionally, some goods are exempt from sales tax as well. The taxability of numerous commodities and services in West Virginia is shown in this table.

Goods & Services

Taxability

Clothing 

6%

Groceries 

Exempt

Prepared Food

6%

Prescription Drugs

Exempt

OTC Drugs

6%

Therefore, this is what the West Virginia sales tax for eCommerce businesses is all about. Now. let’s move on to see the tax collection and tax filing procedure in West Virginia.

Tax Collection

You’ll need to figure out how much sales tax to charge different clients after you receive your seller’s permit and start your business. The correct rate of sales tax needs to be collected by business owners in order to avoid fines and the possibility of costly audits.

You must account for the following types of purchases when calculating sales tax:

  • Store Sales- Calculating sales tax on-site for traditional business owners is simple: all sales are taxed based on the location of the store.
  • In-State Sales- The state of West Virginia has a sales tax policy known as destination-based sales tax. This means long-distance sales within West Virginia are taxed based on the buyer’s address. This regulation applies to sales taxes collected by the state, county, and city. 
  • Out of State Sales- Businesses with nexus in other states are only required to pay sales tax on out-of-state transactions. The term “nexus” refers to a company’s physical presence in another state.

Tax Filing

You’re ready to file your sales tax return now that you’ve applied for your West Virginia seller’s permit and learned how to charge the correct amount of sales tax to all of your clients. You avoid penalties and fines and make sure to meet all filing dates.

Businesses in West Virginia are required to file sales tax forms and make sales tax payments online.

How often do you need to file sales tax in West Virginia?

The frequency with which you must file is determined by the total amount of sales tax your company collects.

  • Annual filing- If your company collects less than $600.00 in sales tax per year, you should file your returns on an annual basis.
  • Quarterly filing- If your firm receives no more than $250.00 in sales tax every month, you should file your returns quarterly.
  • Monthly filing- If your company receives more than $250.00 in sales tax per month, you need to file monthly returns.

What If You File The Tax Return Before The Due Date?

Filing Deadlines

The 20th day of the month is the deadline for all West Virginia sales tax returns unless it is a weekend or federal holiday, in which case the deadline is postponed to the next business day.

Penalties

West Virginia assesses a late filing penalty of 5.0 percent every month or partial month, up to a maximum of 25.00 percent of the tax due.

West Virginia additionally imposes a late payment penalty of 0.5 percent each month, up to a maximum of 25% of the unpaid tax.

Need Assistance With West Virginia Sales Tax

Our staff at Freecashflow.io is committed to assisting internet business owners with tax and accounting issues. Our company has worked for multibillion-dollar corporations including Warner Brothers, Ernst & Young, and Paramount Pictures. You may rely on us for tax and accounting assistance. Please don’t hesitate to get in touch with us!

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