Who Needs A License?
Any organization with a physical existence in South Dakota is needed to be licensed for sales taxation. Gross sales or transactions consist of the sale of concrete individual residential or commercial property, any items moved electronically, or services. The minimum limits listed below do not use to services with a physical presence in South Dakota. South Dakota law also needs any service without a physical presence in South Dakota to acquire a South Dakota sales tax license and pay suitable sales tax if business fulfills the following criteria in the previous or current fiscal year:
How To Get A License
- Register for a South Dakota sales tax license using the online Tax License Application.
- Register with multiple states through the Streamlined system at streamlinedsalestax.org.
Remote Sellers and Marketplace Providers
Remote Sellers
Remote sellers who satisfy specific limits need to acquire a South Dakota sales tax license and pay relevant sales tax. (Per SDCL 10-64) *
A remote seller is a business without a physical existence in South Dakota that meets the following criteria in the previous or current fiscal year:
- Your organization's gross profits from sales into South Dakota went beyond $100,000
* Gross sales or transactions include the sale of concrete personal residential or commercial property, any items transferred electronically, or services.
Marketplace Providers
Marketplace companies who satisfy a particular limit needs to acquire a South Dakota sales tax license and pay relevant sales tax (Per SDCL 10-65).
Who This Impacts
Since March 1, 2019, marketplace providers have been required to accredit their organization and remit relevant sales tax on all sales it assists in into South Dakota if:
- The market company is a remote seller; or
- The market service provider facilitates the sales of at least one market seller that meets the remote seller requirements; or
- The marketplace supplier helps with the sales of 2 or more marketplace sellers that, when the sales are integrated, satisfies the remote seller criteria.
If business does not have a physical presence but has more than $100,000 in gross sales into South Dakota in the previous or current fiscal year, the business is needed to accredit their organization and remit suitable sales tax.
Additional Resources
Marketplace Tax Fact (PDF)
Remote Seller Bulletin (PDF)
Streamlined Sales Tax Remote Sellers Page
2023 Legislative Updates
Sales Tax Facts
Sales tax applies to the gross receipts of all retail sales, consisting of the sale, lease or leasing of concrete personal residential or commercial property or any item transferred digitally, and the sale of all services. Department of Revenue tax fact pages explain how sales and utilize tax applies to each specific industry.
07/23
Exemptions from Sales Tax
There are four factors that products and services would be exempt from South Dakota sales tax.
1. The purchaser is a tax exempt entity;
2. The service or product is specifically exempt from sales tax;
3. The purchaser sends a claim for exemption;
4. The item is delivered to a point outside of the State of South Dakota.
Exempt Entities
State law exempts particular entities from paying South Dakota sales tax or use tax on their purchases. Relief agencies and spiritual and personal schools should use to the department and be approved for exempt status. Their exemption number must be included on the exemption certificate. The exemption numbers for relief companies include an "RA"; independent schools include an "RS". To learn more about exempt entities, please evaluate the Sales Tax Guide (PDF) and Exempt Entity Tax Fact (PDF). These entities include:
- United States federal government agencies
- State of South Dakota
- Indian people
- Public or municipal corporations of the State of South Dakota
- Municipal or volunteer fire or ambulance departments
- Public schools, including K-12, universities and technical institutes that are supported by the State of South Dakota or public or community corporations of South Dakota.
- Non-profit healthcare facilities
- Relief agencies
- SD religious and independent schools
Entities, noted above, that wish to look for a sales & utilize tax exempt status may do so by submitting an application to the Department. We have actually provided a link below.
A non-profit charitable organization that commits its resources solely to the relief of the bad, distressed or impoverished and have actually been recognized as an exempt organization under 501( c )( 3) of the Internal Revenue Code might qualify. Additional certifications consist of a real physical location in South Dakota and the entity must be supplying actual services. For extra information please see our Exempt Entity Tax Fact.
Relief Agencies that certify are needed to restore their application every 5 years.
SALES TAX EXEMPT STATUS APPLICATION
A seller does not have to collect sales tax when a buyer offers a seller a completed exemption certificate at the time of sale. The buyer can offer a "single purchase" certificate for just one transaction or a blanket certificate that uses to future purchases of qualifying exempt products. Exemption certificates do not expire unless the info on the certificate modifications; however, we advise updating exemption certificates every three to four years. To find out more about exempt entities, please evaluate the Sales Tax Guide (PDF) and Exempt Entity Tax Fact (PDF). The exemption certificate is utilized to:
1. Claim exemption for:
2. Products or services meant to be resold; or
3. Products or services used for an exempt purpose.
4. Document that the buyer is an exempt entity.
Exemption Certificate
What is Use Tax?
Use Tax is the counterpart of the South Dakota sales tax. The 2 taxes use to the sales of the very same items and services, have the exact same tax rates and have comparable laws. The distinction is in how the taxes are used. Use tax uses when state and applicable municipal sales tax has actually not been paid on product or services (including services and products transferred electronically) that are used, stored, or consumed in South Dakota. Situations occur when South Dakota sales tax might not have actually been charged and use tax is due include:
- When products are bought from an unlicensed out-of-state supplier;
- When untaxed retail stock is removed for individual or shop use;
When a product bought from an out-of-state vendor is provided in South Dakota, but the other state's tax is incorrectly charged; and
- When a purchase is made in another state then brought into South Dakota and the product was not taxed or was taxed at a lower tax rate than applies in South Dakota, you owe usage tax.
Changes In Your Business? Let Us Know
If there are modifications in your company please use our online forms to submit the modifications.
Cancel Your License
Sales or contractor's excise tax licenses are not transferable. A modification in ownership or legal company, such as from one sole owner to another, from sole owner to a partnership, a modification from sole owner to a corporation, or a merger, needs a brand-new tax license. You must cancel your license within 15 days and instantly submit a last return and pay all tax due if:
1. You close your organization;
2. You offer your company; or
3. The ownership of the organization modifications.
How to Cancel Your License
If you file digitally, you can cancel your license using our online Filing and Tax Payment website. If you file a paper return, please inspect the out-of-business box in the upper right corner of your return, noting the last date of service.
Address Change
Notify the department in writing if your mailing address or your business area modifications. Include the brand-new address information, reliable date of the change, your taxpayer number, and service name.
How to Change Your Address
Please use our Change of Address Form to upgrade your address. If you file electronically, you can alter your address using our online Filing and Tax Payment website. If you file a paper return, you can also make the updates on your income tax return.
Change of Accounting
If your business alters your accounting approach with the Irs you must submit alert to the Department. You are qualified to start reporting under your brand-new accounting technique the very first day of the following month. To alter your accounting approach, please fill out our Change of Accounting Method form. Businesses can report sales based upon two different accounting approaches.
- When utilizing the accrual method, taxes should be paid on all sales made during the reporting period, even if you have actually not received payment. Bad financial obligations you compose off as uncollectible in your books and records and are qualified to be deducted for federal income tax functions.
- When you utilize the cash technique of accounting, you report gross invoices and pay tax as you receive payments. No bad financial obligations are permitted on the money basis.
Sales Tax Statistical Reports
The most recent Sales Tax Statistical Reports are organized in the expand/collapse areas at the bottom of this page. In all cases when you choose a month, you will be viewing information compiled from returns filed with the Department throughout that month. It may cover a variety of taxpayer filing durations, such as regular monthly, bi-monthly, semi-annually etc. It consists of returns declared the current period and those applied for previous durations. Historical Tax Statistical Reports are likewise offered.
Streamlined Sales Tax Project
The approach of the Streamlined Sales Tax Project is basic: the state and services should collaborate to develop simpler, more uniform sales and utilize tax systems.
Streamlined Sales Tax Registration System
To sign up, you may use the Streamlined Registration System. Alternatively, sellers may also use the Streamlined Sales Tax Registration System to develop a sales tax account with the 23 SSUTA member states in a single registration.
Register Now
Streamlined Sales Tax Useful Links
Streamlined Sales Tax FAQs
Rates & Boundary Database Instructions
Simplified Electronic Return
SD Information for Streamlined Sales Tax Participants (PDF).
- SD Tax Matrix Library of Definitions.
Tax Administration Practices
Sales & Use Tax Voluntary Disclosure Program
South Dakota's Voluntary Disclosure Program is developed to assist services or individuals enter compliance with South Dakota's sales and utilize tax laws. You can stay confidential while investigating whether this program is best for your organization. However, if you choose to take part in the program, you will require to apply in composing. If you already have a South Dakota tax license for sales and utilize tax, you can not take part in this program.
Benefits of Participating
- Possible waiver of the charge charges.
- Agreement that the Department will not pursue prosecution.
- Sixty days to figure out the liability and prepare the returns
Receiving Voluntary Disclosure
To receive a voluntary disclosure arrangement, you or your business:
- should not be presently signed up to collect and pay sales, usage, and professional's excise tax in South Dakota,.
- Must not have gathered sales tax,.
- need to not have actually been contacted by either the Department of Revenue or the Multistate Tax Commission to set up an audit, or to finish a nexus questionnaire,.
- are not under audit for any South Dakota tax,.
- are not presently under investigation by any law enforcement company, and you are not presently the topic of a civil action or a prosecution involving the sales and use tax covered by the agreement,.
accept register, file returns, and pay the tax due for the look-back duration within the time frame defined in the arrangement,.
- will make records available for audit to verify the amount of your liability and the precision of your statements upon request.
Application Process
Anyone can call the Department anonymously to learn more about the program. To stay anonymous when making the formal application, you may engage a representative, such as a tax preparer, accountant or attorney. Your request can be emailed to TDU@state.sd.us or sent by mail to the South Dakota Department of Revenue at 445 E. Capitol Ave Pierre, SD 57501.
Your composed demand should consist of the following information:
1. A description of your activities and the date the activities started, consisting of whether you do any of the following: - own or lease residential or commercial property in the state.
- have workers or independent sales representatives soliciting sales in the state.
- have inventory situated in the state.
- make shipments into the state and, if so, the ways of transportation used
2. An estimate of the tax liability for previous tax durations.
3. A declaration of whether you have collected South Dakota taxes.
A declaration that you have actually not been gotten in touch with formerly by South Dakota or the Multistate Tax Commission Nexus Program.
You might discover it helpful to complete a voluntary disclosure with the Multistate Tax Commission if you have numerous states in which you require to register.
Multistate Disclosure Form
Business Education Program
Basic Sales Tax Seminar
These three-hour workshops are kept in Sioux Falls, Rapid City, and Mitchell three to four different times throughout the year. Webinars will be held regularly. Three CPE credits and/or 0.3 CEU credits are awarded for those who get them and participate in the complete seminar. Each workshop covers:
- How and when to apply for a tax license.
- Exemptions from sales and utilize taxes.
- Use tax.
- Municipal taxes.
- Purchases for resale.
- How to submit returns, both by paper and electronically
MN/SD Border Tax Seminars
A three-hour MN/SD Border Sales Tax Seminar and a three-hour ND/SD Border Construction Contractors Seminar are held two times a year in Sioux Falls, South Dakota. A total of 3.0 CPE credits and/or 0.3 CEU credits are granted for each workshop for those who look for them and participate in each whole workshop. If both workshops are attended, a person can make 6.0 CPE credits and/or 0.6 CEU credits.
MN/SD Border Tax Seminar - Sales Tax
- Requirements to sign up in SD and MN.
- Awareness of significant differences in between South Dakota and Minnesota tax laws.
- How these differences might impact your service.
- Practical pointers on how to handle sales and utilize tax commitments for both states.
- Streamlined Sales Tax Project.
- Filing returns
MN/SD Border Tax Seminar - Construction Contractors
ND/SD Border Tax Seminars
A three-hour ND/SD Border Sales Tax Seminar and a two-hour ND/SD Border Construction Contractors Seminar are held twice a year, when in the spring in South Dakota and as soon as in the fall in North Dakota. A total of 3.0 CPE and/or.3 CEU credits are awarded for the Sales Tax seminar, and 2.0 CPE and/or.2 CEU credits are awarded to the Construction Contractors seminar if asked for. If a specific participates in both workshops, or a full day, 5.0 CPE and/or 0.5 CEU credits are granted.
ND/SD Border Tax Seminar - Sales Tax
- Requirements to register in SD and ND.
- Awareness of major distinctions in between SD and ND tax laws.
- How the differences between state tax laws may affect your organization.
- Practical ideas on how to manage sales and use tax responsibilities for both states.
- Streamline Sales Tax Project.
- Available resources.
- Filing returns
ND/SD Border Tax Seminar - Construction Contractors
Topics include:
- Requirements for registration in SD and MN.
- Differences between SD and MN taxes for contractors.
- Prime and subcontractors.
- Point of tax.
- Special jurisdictions/tribal arrangements.
- Owner furnished materials.
- Qualified utilities.
- Filing returns
Find Upcoming Seminars
Sales Tax Rate Charts
In the past, company owner have actually asked if we might provide rate charts. For your benefit, we have created charts for each of the present sales tax rates your company might need. The charts are offered under or Forms/ Resources page. We have also supplied a link below.
