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New YorkSales Tax

A Complete Guide For Businesses

Automate My New YorkSales Tax Filings

State Rate
4.00%

Local Tax
yes

Phone
(518) 485-2889

General requirements

New York is a destination-based state (sales are taxed where the buyer is located).

  • Sales tax is charged on the sale of tangible personal property (TPP) and certain services
  • For manufacturers, purchases used for production aren’t taxed
  • Services subject only to New York City tax include massage, weight control, sauna or gym services

To Web File your sales tax return:

  1. Log in to or create an Online Services account
  2. Select Sales Tax—file and pay from the left-hand menu under Services
  3. Select Sales tax web file from the drop-down

Rates

The New York state sales tax rate is 4%, and additional local tax rates are imposed by a city, county, or school district.

An additional sales tax rate of 0.375% applies to taxable sales made within the Metropolitan Commuter Transportation District. The combined rates vary in each county and city that imposes the tax with the totals ranging from 7% to 9%.

You can look up the correct tax rate by going to the Jurisdiction/Rate Lookup by Address page on the NY State website, or by looking at the current tax rate publication.

How food is taxed

Generally, grocery items are not taxed, but food sold at food stores is taxable when sold under any of the following conditions:

  • It is sold heated
  • It is sold for consumption on the premises
  • It has been prepared by the seller and is ready to be eaten, whether for on-premise or off-premises consumption

Also, the following categories of food are taxable:

  • Sandwiches (whether heated or unheated)
  • Carbonated beverages
  • Candy and confectionery

Nexus in New York

Business activities that establish a minimum tax connection to the state include:

  • Maintaining a physical place of business including a warehouse or distribution center
  • Having employees, independent contractors, or representatives working in the state
  • Delivering goods in business owned vehicles

Online activities that establish nexus in New York include:

  • Having an affiliate or referral relationship with a contractor or representative in the state
  • Sales from these referrals exceed $10,000 during each of the prior 4 quarters

Find out more about nexus in New York.

Filing schedule

The state of New York will put you on a quarterly filing basis if you're expecting to collect sales tax, and your primary business activity is not described as a manufacturer or wholesaler. Your filing frequency may change over time if:

  • Annual filers: You're tax due is less than $3,000
  • Monthly filers: The combined amount of your taxable sales is more than $300,000 in a quarter

You'll be switched back to a quarterly filer if:

  • You're an annual filer and your tax due is above $3,000 in the four most recent quarters
  • You're a monthly filer and your taxable sales is below $300,000 each quarter for four consecutive quarters

The Tax Department will notify you of any changes of your filing frequency.

Go to Filing Requirements for Sales and Use Tax Returns for more information.

Registering to collect sales tax in New York

If you'll be making sales in New York State that are subject to sales tax, you must register with the Tax Department and obtain a Certificate of Authority at least 20 days before you begin business. The Certificate must be displayed at your place of business at all times.

To apply for a Certificate of Authority use the New York Business Express.

Penalties

Penalties are charged on late returns as follows:

  • Failure to file or failure to file a timely return when no tax is due: $50
  • File a return late by 60 days or less: 10% of the tax due for the first month plus 1% for each additional month not to exceed 30% of the tax due, and no less than $50
  • File a return late by 60 days or more: The greater of - 10% of the tax due for the first month, plus 1% for each additional month, not to exceed 30% of the tax due; $100, or 100% of the amount required to be shown as tax on the return, whichever is less; or $50

Go to Sales and Use Tax Penalties on the NY State website for more information.

See how easy it is to automate your sales tax filings.

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