Legal Issues

#1
Hey all,

First off, I know this is definitely not the place to seek legal advise, however, I'm interested to hear if anyone has came across this issue or their shop is getting to the point where they need to set up a business.

@Yaros didn't you publish a blog about setting up a legal business/llc?

I'm in the process of forming my LLC and it's almost complete. now i'm running across the issue with sales & use tax.

I'm hearing that I am required to collect sales tax from every state that I sell to in the US. Meaning if I'm based out of Georgia, I would be required to collect sales tax from any customers and then report the sales to each individual state (california, florida, etc. except like 4 states that don't require tax) Each state's tax rate is different too.

This sounds so complicated and like a nightmare.

Can anyone shine light on this? If anyone already has a running LLC what do you do about sales & use tax?

@Yaros with worldofharry?

Thanks all
 

Sunster

Moderator
Staff member
#2
Definetly be careful with the advice you get on a forum as it's different in every country (and user knowledge) But as an example, in Canada, you are required to collect, report and remit tax once your sales hit the $30000 mark (under this amount you are considered a small supplier). Our provinces have different tax rates so those all have to be entered into WooCommerce. You also have to apply for a tax # and register your business which can be a sole proprietorship, partnership or corporation. I decided to do it right from the start instead of getting issues with the TAX MAN.
 
#3
Yeah I'm not seeking it as is, just more open to learn about people's experiences who have set up a legal business.

I found this article that may be helpful to others: http://blog.taxjar.com/drop-shipping-scenarios-sales-tax/

It does seem semi complicated opening an LLC in US. I'm currently 80% complete of the LLC being formed in Wyoming. Now i'm actually having second thoughts about even establishing an LLC in the USA at all. It seems that the tax thing is very complicated especially if I'm required to qualify to do business in every state as well as collect sales tax for every state.

It seems easier to actually set up a company outside of the US, this way you can avoid all taxes at all and aren't in any "nexus"
 

Taha

New Member
#4
I need help on this. I registered an S corp as a registered business was required to have a decent payment gateway.
The sales tax, income tax etc. is a big question now. shall i increase my margins? how much extra do i charge? is there an option to collect sales tax?
does it have to be based on the state your customer resides? :|
 
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