Who Needs A License?
Any organization with a physical existence in South Dakota is required to be licensed for sales taxation. Gross sales or deals consist of the sale of concrete personal residential or commercial property, any items transferred electronically, or services. The minimum thresholds noted below do not use to services with a physical presence in South Dakota. South Dakota law also requires any company without a physical existence in South Dakota to obtain a South Dakota sales tax license and pay relevant sales tax if business satisfies the following requirements in the previous or existing fiscal year:
How To Get A License
- Register for a South Dakota sales tax license using the online Tax License Application.
- Register with numerous states through the Streamlined system at streamlinedsalestax.org.
Remote Sellers and Marketplace Providers
Remote Sellers
Remote sellers who fulfill specific limits should acquire a South Dakota sales tax license and pay suitable sales tax. (Per SDCL 10-64) *
A remote seller is a company without a physical presence in South Dakota that fulfills the following requirements in the previous or existing calendar year:
- Your company's gross revenue from sales into South Dakota surpassed $100,000
* Gross sales or deals consist of the sale of tangible individual residential or commercial property, any products transferred electronically, or services.
Marketplace Providers
Marketplace companies who fulfill a particular limit must get a South Dakota sales tax license and pay appropriate sales tax (Per SDCL 10-65).
Who This Impacts
Since March 1, 2019, market providers have been required to accredit their company and remit appropriate sales tax on all sales it assists in into South Dakota if:
- The marketplace service provider is a remote seller; or
- The marketplace provider helps with the sales of a minimum of one marketplace seller that meets the remote seller criteria; or
- The market provider helps with the sales of 2 or more marketplace sellers that, when the sales are integrated, fulfills the remote seller criteria.
If the organization does not have a physical existence but has more than $100,000 in gross sales into South Dakota in the previous or current calendar year, business is needed to accredit their company and remit applicable sales tax.
Additional Resources
Marketplace Tax Fact (PDF)
Remote Seller Bulletin (PDF)
Streamlined Sales Tax Remote Sellers Page
2023 Legislative Updates
Sales Tax Facts
Sales tax applies to the gross invoices of all retail sales, including the sale, lease or rental of tangible individual residential or commercial property or any item moved electronically, and the sale of all services. Department of Revenue tax reality pages discuss how sales and use tax applies to each particular industry.
07/23
Exemptions from Sales Tax
There are four reasons that product or services would be exempt from South Dakota sales tax.
1. The purchaser is a tax exempt entity;
2. The product and services is specifically exempt from sales tax;
3. The buyer sends a claim for exemption;
4. The product is delivered to a point beyond the State of South Dakota.
Exempt Entities
State law exempts certain entities from paying South Dakota sales tax or use tax on their purchases. Relief agencies and religious and private schools must apply to the department and be approved for exempt status. Their exemption number must be consisted of on the exemption certificate. The exemption numbers for relief firms include an "RA"; personal schools include an "RS". To learn more about exempt entities, please evaluate the Sales Tax Guide (PDF) and Exempt Entity Tax Fact (PDF). These entities consist of:
- United States government firms
- State of South Dakota
- Indian tribes
- Public or local corporations of the State of South Dakota
- Municipal or volunteer fire or ambulance departments
- Public schools, including K-12, universities and technical institutes that are supported by the State of South Dakota or public or local corporations of South Dakota.
- Non-profit health centers
- Relief agencies
- SD spiritual and independent schools
Entities, noted above, that dream to obtain a sales & use tax exempt status may do so by submitting an application to the Department. We have provided a link below.
A non-profit charitable company that dedicates its resources specifically to the relief of the bad, distressed or underprivileged and have been recognized as an exempt organization under 501( c )( 3) of the Internal Revenue Code may qualify. Additional credentials include a real physical location in South Dakota and the entity should be supplying real services. For extra details please see our Exempt Entity Tax Fact.
Relief Agencies that qualify are required to restore their application every five years.
SALES TAX EXEMPT STATUS APPLICATION
A seller does not have to gather sales tax when a purchaser provides a seller a finished exemption certificate at the time of sale. The buyer can provide a "single purchase" certificate for just one deal or a blanket certificate that uses to future purchases of qualifying exempt items. Exemption certificates do not expire unless the details on the certificate changes; however, we suggest upgrading exemption certificates every 3 to 4 years. For additional information about exempt entities, please review the Sales Tax Guide (PDF) and Exempt Entity Tax Fact (PDF). The exemption certificate is used to:
1. Claim exemption for:
2. Products or services planned to be resold; or
3. Products or services used for an exempt purpose.
4. Document that the buyer is an exempt entity.
Exemption Certificate
What is Use Tax?
Use Tax is the counterpart of the South Dakota sales tax. The 2 taxes use to the sales of the exact same services and products, have the exact same tax rates and have similar laws. The difference remains in how the taxes are applied. Use tax applies when state and suitable community sales tax has not been paid on items and services (consisting of product or services transferred digitally) that are used, kept, or consumed in South Dakota. Situations happen when South Dakota sales tax might not have actually been charged and utilize tax is due consist of:
- When items are bought from an unlicensed out-of-state vendor;
- When untaxed retail stock is removed for individual or store usage;
When a product bought from an out-of-state vendor is delivered in South Dakota, however the other state's tax is incorrectly charged; and
- When a purchase is made in another state then brought into South Dakota and the product was not taxed or was taxed at a lower tax rate than uses in South Dakota, you owe use tax.
Changes In Your Business? Let Us Know
If there are modifications in your company please use our online forms to send the modifications.
Cancel Your License
Sales or contractor's excise tax licenses are not transferable. A modification in ownership or legal organization, such as from one sole owner to another, from sole proprietor to a collaboration, a modification from sole owner to a corporation, or a merger, needs a brand-new tax license. You must cancel your license within 15 days and instantly file a final return and pay all tax due if:
1. You close your service;
2. You sell your service; or
3. The ownership of the organization changes.
How to Cancel Your License
If you file digitally, you can cancel your license utilizing our online Filing and Tax Payment website. If you submit a paper return, please examine the out-of-business box in the upper right corner of your return, noting the last date of company.
Address Change
Notify the department in composing if your mailing address or your organization area modifications. Include the brand-new address info, effective date of the modification, your taxpayer number, and company name.
How to Change Your Address
Please use our Change of Address Form to upgrade your address. If you file electronically, you can alter your address utilizing our online Filing and Tax Payment portal. If you submit a paper return, you can likewise make the updates on your tax return.
Change of Accounting
If your company changes your accounting method with the Internal Revenue Service you must send alert to the Department. You are eligible to start reporting under your new accounting method the very first day of the following month. To alter your accounting method, please fill out our Change of Accounting Method kind. Businesses can report sales based on 2 different accounting methods.
- When using the accrual approach, taxes need to be paid on all sales made during the reporting period, even if you have actually not received payment. Uncollectable bills you cross out as uncollectible in your books and records and are eligible to be deducted for federal earnings tax purposes.
- When you use the cash approach of accounting, you report gross invoices and pay tax as you get payments. No uncollectable bills are allowed on the money basis.
Sales Tax Statistical Reports
The most recent Sales Tax Statistical Reports are organized in the expand/collapse regions at the bottom of this page. In all cases when you choose a month, you will be seeing information assembled from returns submitted with the Department during that month. It might cover a variety of taxpayer filing durations, such as month-to-month, bi-monthly, semi-annually and so on. It consists of returns applied for the existing duration and those filed for previous periods. Historical Tax Statistical Reports are likewise available.
Streamlined Sales Tax Project
The approach of the Streamlined Sales Tax Project is easy: the state and services ought to work together to develop easier, more uniform sales and use tax systems.
Streamlined Sales Tax Registration System
To sign up, you might use the Streamlined Registration System. Alternatively, sellers might also use the Streamlined Sales Tax Registration System to establish a sales tax account with the 23 SSUTA member states in a single registration.
Register Now
Streamlined Sales Tax Useful Links
Streamlined Sales Tax FAQs
Rates & Boundary Database Instructions
Simplified Electronic Return
SD Information for Streamlined Sales Tax Participants (PDF).
- SD Tax Matrix Library of Definitions.
Tax Administration Practices
Sales & Use Tax Voluntary Disclosure Program
South Dakota's Voluntary Disclosure Program is developed to help services or individuals enter into compliance with South Dakota's sales and use tax laws. You can remain anonymous while investigating whether this program is right for your service. However, if you choose to take part in the program, you will require to use in writing. If you currently have a South Dakota tax license for sales and use tax, you can not take part in this program.
Benefits of Participating
- Possible waiver of the penalty charges.
- Agreement that the Department will not pursue prosecution.
- Sixty days to determine the liability and prepare the returns
Getting Approved For Voluntary Disclosure
To receive a voluntary disclosure contract, you or your company:
- must not be currently signed up to collect and pay sales, use, and professional's excise tax in South Dakota,.
- Must not have collected sales tax,.
- need to not have been by either the Department of Revenue or the Multistate Tax Commission to set up an audit, or to complete a nexus questionnaire,.
- are not under audit for any South Dakota tax,.
- are not presently under investigation by any police, and you are not currently the subject of a civil action or a criminal prosecution including the sales and utilize tax covered by the contract,.
consent to sign up, file returns, and pay the tax due for the look-back period within the time frame defined in the arrangement,.
- will make records offered for audit to confirm the quantity of your liability and the precision of your declarations upon request.
Application Process
Anyone can contact the Department anonymously to discover more about the program. To remain anonymous when making the official application, you might engage a representative, such as a tax preparer, accounting professional or lawyer. Your demand can be emailed to [email protected] or mailed to the South Dakota Department of Revenue at 445 E. Capitol Ave Pierre, SD 57501.
Your composed request ought to contain the following information:
1. A description of your activities and the date the activities began, consisting of whether you do any of the following: - own or lease residential or commercial property in the state.
- have workers or independent sales agents soliciting sales in the state.
- have stock situated in the state.
- make deliveries into the state and, if so, the methods of transport utilized
2. A quote of the tax liability for previous tax durations.
3. A declaration of whether you have actually collected South Dakota taxes.
A declaration that you have not been gotten in touch with formerly by South Dakota or the Multistate Tax Commission Nexus Program.
You might find it beneficial to finish a voluntary disclosure with the Multistate Tax Commission if you have multiple states in which you need to register.
Multistate Disclosure Form
Business Education Program
Basic Sales Tax Seminar
These three-hour workshops are kept in Sioux Falls, Rapid City, and Mitchell three to 4 various times throughout the year. Webinars will be held periodically. Three CPE credits and/or 0.3 CEU credits are granted for those who request them and attend the full seminar. Each workshop covers:
- How and when to obtain a tax license.
- Exemptions from sales and use taxes.
- Use tax.
- Municipal taxes.
- Purchases for resale.
- How to submit returns, both by paper and electronically
MN/SD Border Tax Seminars
A three-hour MN/SD Border Sales Tax Seminar and a three-hour ND/SD Border Construction Contractors Seminar are held two times a year in Sioux Falls, South Dakota. A total of 3.0 CPE credits and/or 0.3 CEU credits are granted for each workshop for those who get them and participate in each whole workshop. If both workshops are participated in, an individual can make 6.0 CPE credits and/or 0.6 CEU credits.
MN/SD Border Tax Seminar - Sales Tax
- Requirements to register in SD and MN.
- Awareness of major differences between South Dakota and Minnesota tax laws.
- How these differences might affect your organization.
- Practical tips on how to manage sales and use tax commitments for both states.
- Streamlined Sales Tax Project.
- Filing returns
MN/SD Border Tax Seminar - Construction Contractors
ND/SD Border Tax Seminars
A three-hour ND/SD Border Sales Tax Seminar and a two-hour ND/SD Border Construction Contractors Seminar are held twice a year, when in the spring in South Dakota and when in the fall in North Dakota. A total of 3.0 CPE and/or.3 CEU credits are awarded for the Sales Tax workshop, and 2.0 CPE and/or.2 CEU credits are awarded to the Construction Contractors seminar if asked for. If an individual participates in both seminars, or a complete day, 5.0 CPE and/or 0.5 CEU credits are awarded.
ND/SD Border Tax Seminar - Sales Tax
- Requirements to register in SD and ND.
- Awareness of major distinctions in between SD and ND tax laws.
- How the distinctions between state tax laws may impact your company.
- Practical ideas on how to handle sales and utilize tax obligations for both states.
- Streamline Sales Tax Project.
- Available resources.
- Filing returns
ND/SD Border Tax Seminar - Construction Contractors
Topics consist of:
- Requirements for registration in SD and MN.
- Differences in between SD and MN taxes for specialists.
- Prime and subcontractors.
- Point of tax.
- Special jurisdictions/tribal contracts.
- Owner furnished materials.
- Qualified utilities.
- Filing returns
Find Upcoming Seminars
Sales Tax Rate Charts
In the past, entrepreneur have actually asked if we might supply rate charts. For your benefit, we have put together charts for each of the existing sales tax rates your company might require. The charts are available under or Forms/ Resources page. We have actually also supplied a link below.
