On August 1, 2019, the Kansas Department of Revenue issued Notice 19-04 regarding Sales Tax Requirements for Retailers Doing Business in Kansas.
This notice was issued as a result of the Wayfair court case decision in June 2018, which allowed states to require remote sellers to collect and remit sales tax. While many states are passing thresholds before requiring remote sellers to collect and remit sales tax, businesses should look at each state’s rules to determine what is required.
Kansas Notice 19-04 states that any remote seller who sells tangible personal property or services into the state of Kansas must collect and remit sales tax (even if they do not have a physical presence). Kansas did not place any safe harbor thresholds on this statute. What this means for businesses is that if they are located in another state but ship taxable goods to their customers in Kansas or perform any taxable services in Kansas, they now must collect and remit sales tax for each transaction.
Before this notice, it would have been the customer’s obligation to file a use tax return if the seller did not have physical presence in the state, but this shifts the burden of reporting to the seller, as the seller is now being considered to have economic nexus with Kansas.
According to the notice, remote sellers have until October 1, 2019 to register with the Kansas Department of Revenue, as well as start collecting and remitting sales tax. If they do so, the state will not enforce the statutory requirements from before October 1st.
Please contact us if you have any questions or concerns, as well as if you need any assistance on registering for Kansas Sales Tax.