Introduction
Use tax is a tax on the storage, use, or consumption of a taxable item or service on which no sales tax has been paid. Use tax is a complementary tax to the sales tax and does not apply when sales tax is charged. Use tax may apply in many circumstances:
- Vendor doesn't collect sales tax — A purchaser is liable for use tax when a vendor does not charge sales tax on an invoice for the sale of an otherwise taxable item, and no sales and use tax exemption applies.
- Out-of-state purchases — Use tax may apply to purchases made outside the taxing jurisdiction but brought into and used within the state. If the use tax rate in the state where the item purchased is being used is greater than the sales tax rate in the jurisdiction where the purchase was made, then use tax is due to the extent it exceeds the original sales tax rate.
- Change in use — Use tax also applies to items purchased exempt from tax, which are subsequently used in a taxable manner.
Use tax is a tax on the purchaser and is self-assessed by the purchaser on taxable items purchased when the vendor did not collect either a sales or vendor use tax. The tax must be remitted directly to the taxing jurisdiction.
Anrok allows you to report use sales on your returns in-app to ensure you remain compliant. If you would like to begin reporting use tax using Anrok, please submit this form to enable this reporting feature on your Anrok account.
Report use tax on a return
You can report all use tax on your returns to ensure these assessments are reported to the jurisdiction and maintain compliance.
Try reporting use tax on a return in the demo above ☝️
- In the Anrok app
, go to Tax calculator. Take me there!
- Under Customer address, enter the address where you plan to use the item(s).
- Under Product sales, select the Product being used, and then enter the Total sales for the product.
- When you are finished, click Calculate, then copy the Total tax amount.
- Once complete, go to Returns & payments.
- Select the
return with use tax.
- Under Use tax, click the Pencil icon
.
- Enter the Total purchases amount and the Use tax amount.
- Under Location of use, enter the address where you plan to use the item(s).
- When you are finished, click Save.