Best Practices for Collecting Sales Tax at In-Person Events
Collecting and understanding when to charge tax can be a scary prospect, but never fear your friends at Storenvy are here to help with a guide on collecting tax at craft fairs, festivals and pop-up shops.
If you sell on Storenvy, you’re probably already familiar with collecting sales tax for your online sales from customer in your state or country, but If you’re planning to sell your products in-person, at a craft fair or popup shop for example, you might not be aware of the differences for collecting sales tax in-person.
First up, you are required to get a temporary seller’s permit for every location you sell in. You should already have one, even for online sales, for the location of your business, but you will also need one for every fair or other location you sell your products. (If you are selling them, if your products are on sale in a store through a wholesale or consignment contract, that’s different)
Each permit is free but you need to contact the Board of Equalization at least a few days ahead of time so they can mail it to you. If you are cutting it fine, I believe you can also go directly to the BoE office and get a permit straight away.
Second, you are required to collect sales tax on every in-person sale you make. It doesn’t matter if the buyer pays with cash or credit card or if they live across the world. You should keep a record of all the sales you make so you know how much sales tax to pay, and so you can prove you paid the right amount if you are ever audited.
If dealing with weird amounts of money is too much of a pain for cash sales, you are allowed to just include the sales tax in the total cost. If you do this, you must have a sign up somewhere to inform your customers that is what you’re doing. If you include the tax for cash sales and not for credit card sales, that’s fine but you must say so. You will still have to pay the sales tax on all those sales yourself. Be warned, I have heard of BoE officials coming to craft fairs to check up on things like this!
You also need to be aware of what the tax rate is, the city or county rate may not be the same as the state rate, so make sure you are charging the correct amount!
I hope some of this was useful for you, please be aware that I am not a tax expert and this information can change. It is your responsibility to know the rules and make sure you are sticking to them!
I can only speak for California on this, but a lot of this information will be relevant to sellers in other states, and maybe other countries, as well.
