Dropshipping, sales tax, Canada-USA

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Nikster

New member
Jan 10, 2014
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Hey guys,
I've had a couple of ecommerce websites back in the day, and they only targeted and sold to Canadian consumers.

I want to start another ecommerce website and this time target USA. My business is registered in Canada, and I've never used US based dropshippers. On their applications they are asking for State Sales Tax or Release Number. Considering that my business is registered in the states, do I still need this tax license? If I don't obtain one, would the supplier charge me tax, or refuse to work with me?

Anything helps before I start calling the suppliers and sound like a complete amateur :)
 


Follow the laws in the state you are registered in.
With my ecommerce site I followed the tax law in the state I was located and the LLC was registered in, PA. Even though things were drop shipped from 7 different locations, 5 of which were out of the country.
 
Nikster said:
Hey guys,
I've had a couple of ecommerce websites back in the day, and they only targeted and sold to Canadian consumers.

I want to start another ecommerce website and this time target USA. My business is registered in Canada, and I've never used US based dropshippers. On their applications they are asking for State Sales Tax or Release Number. Considering that my business is registered in the states, do I still need this tax license? If I don't obtain one, would the supplier charge me tax, or refuse to work with me?

Anything helps before I start calling the suppliers and sound like a complete amateur :)
Click to expand...

Following the law from where you're site is registered is the least thing you can do. So you won't face any legal actions in the future. no one wants in that situation. Goodluck on your business. :)
 
My concern is with the wholesalers. Some of them want to charge me taxes on all items that I am purchasing from them and reselling. Others want to charge me taxes only if my customer is in Florida. My business is registered in Canada, so I pay taxes here.

I haven't called the majority of the manufacturers/dropshippers because I don't want to blow my cover yet. It is hard to get the good dropshippers, so I want my websites + some products to already be on the site before I call them.

I really don't feel like registering tax exemptions with 50 states :)
 
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