Does your business have economic nexus in the state of Indiana? Minimize the guesswork and uncertainty and use TaxJar’s sales tax guide and calculator for the state of Indiana to learn more about your estimated tax obligations and understand the process of filing your Indiana sales tax return. TaxJar simplifies the sales tax process, ensuring you never miss a deadline or a payment.
Do you need to collect sales tax in Indiana?
You must collect sales tax in Indiana if you have nexus in the state. There are two types of nexus that impact sales tax filing obligations. Physical nexus means that a business (or seller) has a tangible presence or activity in a state, and this presence requires them to pay sales tax in that state. Economic nexus means that a business or seller meets a state’s economic threshold for total revenue or the number of transactions in that state.
Do you have physical nexus in Indiana?
Indiana considers a seller to have physical nexus if they have any of the following in the state:
- Owned or leased tangible personal property
- An employee or independent sales representative in the state
- Indiana inventories
- Third parties that install, repair or service property that is sold to Indiana customers.
The Indiana Department of Revenue understands that some businesses may be noncompliant with their sales tax filings or payments; online sellers do not always understand the legalities of sales tax obligations in each state, leading to tax noncompliance.
Indiana’s Voluntary Disclosure (VDA) Program allows businesses that are noncompliant with their filings to come forward anonymously. By participating in this program, businesses receive a written agreement from the state that decreases the look-back period; businesses also receive reduced penalties and, most importantly, they avoid an audit. Sellers and businesses are invited to apply for the VDA Program to get back on track and fulfill their tax obligations.
Do you have economic nexus in Indiana?
Indiana law requires a seller without a physical location in Indiana to obtain a registered retail merchant’s certificate, collect and remit applicable sales tax if the seller meets the following condition in the previous or current calendar year:
- Gross revenue from sales into Indiana exceeding $100,000, including sales that are not subject to sales tax or are considered tax exempt.
Indiana removed the 200-transaction threshold effective March 29, 2024. The Indiana Department of Revenue offers additional insights to remote sellers related to economic nexus in the state. TaxJar’s online resources can help you learn more about how economic nexus thresholds vary by state.
Is what you’re selling taxable?
Services in Indiana are generally not taxable. However, if the service you provide includes fabrication, alteration or preparation of a product, you may need to collect and pay sales tax on the sale of these products.
Tangible products are taxable in Indiana, with a few exemptions. These exemptions include grocery items, items sold to farmers, and items sold to construction contractors.
Is SaaS taxable in Indiana?
SaaS is considered non-taxable in Indiana. A recent ruling further addressed the taxation guidelines related to SaaS, expanding to include clarification that in-game purchases (and virtual currency) also were not taxable.
How to get a sales tax permit in Indiana
You can register for a sales tax permit through Indiana’s tax center INTIME, or visit our registration page to request that TaxJar manage your Indiana registration.
- To register for a sales tax permit in Indiana, you will need your estimated monthly taxable sales. If left blank you will be a monthly filer.
There is a $25 registration fee for businesses in Indiana. Other business registration fees may apply. Contact each state’s individual department of revenue for more about registering your business.
Use the Streamlined Sales Tax™ Registration System (SSTRS)
Indiana is a Streamlined Sales Tax™ Member state. The Streamlined Sales Tax™ Registration System is made up of a group of states that aimed to simplify the process of registering for a tax permit for online sellers. The system allows businesses to apply for a license in any member state, providing a central hub for this purpose. Businesses can also opt to contract with a Certified Service Provider™ (CSP™ ) through the system. The CSP serves as a sales tax concierge, providing sales tax assistance to businesses in all the states where they are registered through the SSTRS.
Collecting sales tax
The Indiana sales tax rate is 7%, with no local sales taxes. Collecting sales tax in Indiana only requires that businesses and sellers apply the state sales tax rate of 7% to applicable sales.
Should you collect sales tax on shipping charges in Indiana?
If you ship taxable goods to buyers in Indiana, you are most likely required to charge sales tax on shipping charges.
Learn more about sales tax on shipping in Indiana.
When are returns due?
When you file and pay Indiana sales tax depends on your assigned filing frequency and your state’s due dates.
How often will you file sales tax returns in Indiana?
States assign your business a filing frequency when you register for your sales tax permit. In most states, how often you file sales tax is based on the amount of sales tax you collect from buyers in the state.
In Indiana, you will be required to file and remit sales tax either monthly or annually (calendar annual or fiscal annual).Indiana sales tax returns are generally due the 20th of the month following the reporting period, though some may be due on different dates. If the Indiana filing due date falls on a weekend or holiday, sales tax is due the next business day.
Filing sales tax
When it comes time to file sales tax in Indiana you must do three things:
- Calculate how much sales tax you owe
- File a sales tax return
- Make a payment
How to calculate how much sales tax you owe in Indiana
Calculating how much sales tax you should remit to the state of Indiana is easy with TaxJar’s Indiana sales tax report.
Connect the channels through which you sell – including Amazon, eBay, Shopify, Square and more – and we’ll calculate exactly how much sales tax you collected. All the information you need to file your Indiana sales tax return will be waiting for you in TaxJar. All you have to do is login.
How to file and pay sales tax in Indiana
You have a couple of options for filing and paying your Indiana sales tax:
- File online at the Indiana Department of Revenue. You can remit your tax bill through their online system.
- AutoFile – Let TaxJar file your sales tax for you. We take care of the payments, too. You’ll never have to worry about spreadsheets, calculations, or filling out complex sales tax returns.