How does Locally handle sales tax collection and remittance?

Overview

Due to laws requiring Marketplace Facilitators to collect and remit sales tax, on January 1, 2021 we launched a new way of calculating, collecting and remitting sales tax information. An announcement is available here

Locally collects and remits sales tax on payments for store pickup or same-day delivery in the United States and Canada. This does not apply to reservations for store pickup. 

Stores should continue to ring up Locally sales normally. Each month, you'll view a statement of what has been collected and remitted on your behalf in your Locally dashboard. Subtract this amount from your normal sales tax remittance routine.   

How should I account for Locally handling sales tax?

US and Canada

Load the "Sales Tax" panel in your Locally dashboard here. Locally logs the sales tax details for every transaction here. Try the following: 

  • Click "Show/Hide Totals" to view a given month's breakdown by location and by jurisdiction  
  • Click Download CSV for an excel spreadsheet of all transactions and corresponding sales tax details

For most retailers, when remitting taxes to your taxing jurisdictions each month, you will load that month in the Sales Tax panel and deduct this amount from the amount you remit. Please consult local professionals for further guidance. 

Certain states require Locally provide a certificate or form attesting that we are collecting and remitting taxes. You can request this form from Locally by filling out this form.  

Outside the US and Canada

Sales tax is included in the amount paid by shoppers and transmitted in full to your stripe account.

How is sales tax calculated?

US and Canada

Effective January 1, 2021, Locally utilizes a service that monitors sales tax rates across the United States and Canada and calculates the sales tax rate per item in the shopper's cart based on the tax rules in your local tax jurisdiction. For example, if your jurisdiction taxes shoes and boats differently, those differences will be reflected in the cart. 

This applies to any Locally order involving a payment: Buy Online Pickup in Store, Same-Day Delivery, and Ship to Store. This does not apply to Reservations for Store Pickup.

Outside the US and Canada

Locally will use the sales tax rate you've entered in "Step 4: Local Tax Rate" in the Buy It Locally Setup & Configuration panel of your Locally dashboard.

How is sales tax collected and remitted?

US and Canada

Locally collects the sales tax as a fee deducted from the transaction in Stripe. Load any payment in your Stripe dashboard and hover over the "Fee" section in "Payment details." The sales tax collection displays as "Locally Application Fee" as shown here: 


Locally remits the sales tax to each tax jurisdiction in accordance with applicable law. You are not responsible for remitting sales tax on these orders.

Outside the US and Canada

The sales tax amount is included in your Stripe payment. You are responsible for remitting the tax. 

There's an issue with how sales tax is being calculated. What should I do?

Please open a support ticket and include the Order # as well as any additional information that will help us troubleshoot this quickly for you.  




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