Calculating Sales Taxes and Record Keeping
Calculating the Sales Tax
To calculate the sales tax due after the sale, you need to add:
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The state sales tax
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Local jurisdiction (city, county and school district) tax rate.
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You need to add ¼% to your sales tax calculation if you are located within the Metropolitan Commuter Transportation District (MCTD) which includes:
Read Publication 718 for an updated list of State and Local Sales Tax Rates
Note to businesses shipping products to clients. Include the shipping charge when calculating the sales tax.
Record Keeping
To keep good records of every sale you need to:
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Record in every transaction the amount charged, paid or due
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If applicable, record the amount of sales tax owed for the transaction.
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If you give a written receipt, retain a copy or other evidence. Unless you keep a daily record of cash and credit sales on your journal.
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The records must maintain sufficient documentation and detail to independently verify the sales tax due in each transaction.
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If the delivery of the taxable products and services you sell is other than your place of business, you must record the other points of delivery. (exceptions apply to motor vehicle and certain boats sales, refer to Publication 750
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For products or services delivered outside of NY State, you do not need to collect NY State tax. There is an exception for vendors who participate in sales tax agreements with Connecticut and New Jersey, they need to collect state and local taxes for deliveries in those states.
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You must provide the Tax Department access to equipment, programs and records if you keep your records in electronic format.
For purchases:
You need to keep records of the amount, value, type and nature of all business purchases. You need to keep accurate records (keep all purchase invoices) and determine any sales and use tax due.
Note, you need to provide the Tax Department access to all records, equipment or software if you keep your records in electronic format.
Receipts to costumers:
When giving a customer a receipt for a transaction, (this includes any statement relating to the transaction such as, sales slip, invoice, etc.) Include the sales tax amount due separately.
If you opt not to provide the costumer with a receipt, you can use the alternative unit price method. The alternative unit price method is the unit price of the product including sales tax. If you use this method, you must display a sign for the customers stating that the sales tax is included in the price. You must also separate taxable and non-taxable products and have a detailed list available for the costumer.
