Who Needs A License?

Any company with a physical existence in South Dakota is required to be accredited for sales taxation. Gross sales or transactions consist of the sale of concrete individual residential or commercial property, any products transferred electronically, or services. The minimum thresholds noted below do not use to services with a physical presence in South Dakota. South Dakota law also requires any company without a physical existence 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 existing calendar 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 meet specific thresholds need to get a South Dakota sales tax license and pay suitable sales tax. (Per SDCL 10-64) *

A remote seller is an organization without a physical presence in South Dakota that meets the following criteria in the previous or current fiscal year:

- Your service's gross profits from sales into South Dakota exceeded $100,000

* Gross sales or deals consist of the sale of concrete personal residential or commercial property, any items transferred electronically, or services.

Marketplace Providers

Marketplace companies who fulfill a certain limit must obtain 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 needed to accredit their company and remit appropriate sales tax on all sales it helps with into South Dakota if:

- The marketplace service provider is a remote seller; or
- The marketplace company assists in the sales of at least one marketplace seller that satisfies the remote seller requirements; or
- The marketplace service provider assists in the sales of 2 or more market sellers that, when the sales are integrated, meets the remote seller criteria.

If business does not have a physical existence but has more than $100,000 in gross sales into South Dakota in the previous or present fiscal year, business is needed to license their business and remit appropriate 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 invoices of all retail sales, including the sale, lease or rental of concrete individual residential or commercial property or any product moved digitally, and the sale of all services. Department of Revenue tax fact pages explain how sales and utilize tax uses to each particular industry.

07/23

Exemptions from Sales Tax

There are 4 reasons that product or services would be exempt from South Dakota sales tax.

1. The buyer is a tax exempt entity;
2. The item or service is particularly exempt from sales tax;
3. The purchaser sends a claim for exemption;
4. The product is provided to a point outside of the State of South Dakota.

Exempt Entities

State law excuses specific 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 authorized for exempt status. Their exemption number must be consisted of on the exemption certificate. The exemption numbers for relief firms consist of an "RA"; personal schools consist of an "RS". For additional information about exempt entities, please examine the Sales Tax Guide (PDF) and Exempt Entity Tax Fact (PDF). These entities include:

- United States government agencies
- State of South Dakota
- Indian tribes
- Public or municipal corporations of the State of South Dakota
- Municipal or volunteer fire or ambulance departments
- Public schools, consisting of 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 medical facilities
- Relief companies
- SD religious and private schools

Entities, noted above, that dream to make an application for a sales & use tax exempt status may do so by submitting an application to the Department. We have provided a link listed below.

A non-profit charitable company that devotes its resources exclusively to the relief of the bad, distressed or underprivileged and have actually been recognized as an exempt company under 501( c )( 3) of the Internal Revenue Code may certify. Additional credentials consist of a real physical place in South Dakota and the entity need to be providing real services. For additional information please see our Exempt Entity Tax Fact.

Relief Agencies that qualify are needed to renew their application every five years.

SALES TAX EXEMPT STATUS APPLICATION

A seller does not need to collect sales tax when a buyer gives a seller a finished exemption certificate at the time of sale. The purchaser can provide a "single purchase" certificate for just one deal or a blanket certificate that applies to future purchases of qualifying exempt products. Exemption certificates do not expire unless the info on the certificate changes; however, we advise updating exemption certificates every 3 to four years. To find out more about exempt entities, please examine 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 intended to be resold; or
3. Products or services utilized for an exempt function.
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 same tax rates and have comparable laws. The distinction is in how the taxes are applied. Use tax uses when state and appropriate local sales tax has actually not been paid on product or services (including products and services moved digitally) that are used, kept, or consumed in South Dakota. Situations take place when South Dakota sales tax might not have actually been charged and utilize tax is due consist of:

- When products are acquired from an unlicensed out-of-state supplier;
- When untaxed retail inventory is gotten rid of for personal or shop use;
When an item acquired from an out-of-state vendor is delivered in South Dakota, however the other state's tax is incorrectly charged; and
- When a purchase is made in another state then brought into South Dakota and the item was not taxed or was taxed at a lower tax rate than uses in South Dakota, you owe use tax.

Changes In Your Business? Let Us Know

If there are modifications in your business please utilize our online types to submit the modifications.

Cancel Your License

Sales or contractor's excise tax licenses are not transferable. A modification in ownership or legal organization, such as from one sole proprietor to another, from sole proprietor to a collaboration, 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 immediately submit a final return and pay all tax due if:

1. You close your business;
2. You sell your service; or
3. The ownership of the business changes.

How to Cancel Your License

If you file electronically, you can cancel your license utilizing our online Filing and Tax Payment website. If you submit a paper return, please check the out-of-business box in the upper right corner of your return, listing the last date of business.

Address Change

Notify the department in composing if your mailing address or your service area modifications. Include the brand-new address details, effective date of the modification, your taxpayer number, and organization name.

How to Change Your Address

Please use our Change of Address Form to update your address. If you submit electronically, you can change your address utilizing our online Filing and Tax Payment portal. If you submit a paper return, you can also make the updates on your income tax return.

Change of Accounting

If your company alters your accounting approach with the Irs you must submit alert to the Department. You are eligible to start reporting under your new accounting technique the very first day of the following month. To change your accounting method, please fill out our Change of Accounting Method form. Businesses can report sales based on two different accounting techniques.

- When using the accrual method, taxes must be paid on all sales made throughout the reporting period, even if you have actually not received payment. Uncollectable bills you write off as uncollectible in your books and records and are eligible to be subtracted for federal income tax purposes.
- When you utilize the cash method of accounting, you report gross invoices and pay tax as you receive payments. No uncollectable bills are enabled on the cash basis.

Sales Tax Statistical Reports

The most recent Sales Tax Statistical Reports are organized in the expand/collapse regions at the bottom of this page. In all cases when you choose a month, you will be viewing data compiled from returns filed with the Department during that month. It may cover a variety of taxpayer filing durations, such as regular monthly, bi-monthly, semi-annually and so on. It consists of returns declared the current duration and those submitted for previous periods. Historical Tax Statistical Reports are likewise offered.

Streamlined Sales Tax Project

The philosophy of the Streamlined Sales Tax Project is simple: the state and companies should interact to produce simpler, more consistent sales and use tax systems.

Streamlined Sales Tax Registration System

To sign up, you might utilize the Streamlined Registration System. Alternatively, sellers may likewise 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 designed to help organizations or people get into compliance with South Dakota's sales and use tax laws. You can stay confidential while examining whether this program is ideal for your company. However, if you decide to take part in the program, you will need to use in writing. If you already have a South Dakota tax license for sales and use tax, you can not participate 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 get approved for a voluntary disclosure arrangement, you or your company:

- should not be currently signed up to gather and pay sales, usage, and professional's excise tax in South Dakota,.
- Must not have actually collected sales tax,.
- must not have actually been called by either the Department of Revenue or the Multistate Tax Commission to arrange an audit, or to complete a nexus questionnaire,.
- are not under audit for any South Dakota tax,.
- are not currently under investigation by any law enforcement company, and you are not currently the subject of a civil action or a prosecution including the sales and utilize tax covered by the agreement,.
accept register, submit returns, and pay the tax due for the look-back period within the time frame defined in the arrangement,.
- will make records readily available for audit to validate the quantity 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 remain confidential when making the formal application, you might engage a representative, such as a tax preparer, accounting professional or lawyer. Your demand can be emailed to TDU@state.sd.us or mailed to the South Dakota Department of Revenue at 445 E. Capitol Ave Pierre, SD 57501.

Your composed request must consist of the following details:

1. A description of your activities and the date the activities began, including whether you do any of the following: - own or lease residential or commercial property in the state.
- have employees or independent sales representatives soliciting sales in the state.
- have stock situated in the state.
- make deliveries into the state and, if so, the methods of transport utilized

2. A quote of the tax liability for previous tax durations.
3. A declaration of whether you have actually collected South Dakota taxes.
A statement that you have actually not been contacted previously by South Dakota or the Multistate Tax Commission Nexus Program.

You might discover it useful to complete a voluntary disclosure with the Multistate Tax Commission if you have several states in which you need to sign up.

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 4 various times throughout the year. Webinars will be held occasionally. Three CPE credits and/or 0.3 CEU credits are granted for those who make an application for them and go to the complete workshop. Each seminar covers:

- How and when to use for a tax license.
- Exemptions from sales and use taxes.
- Use tax.
- Municipal taxes.
- Purchases for resale.
- How to file returns, both by paper and digitally

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 twice a year in Sioux Falls, South Dakota. An overall of 3.0 CPE credits and/or 0.3 CEU credits are granted for each workshop for those who get them and go to each whole seminar. If both workshops are attended, an individual 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 distinctions between South Dakota and Minnesota tax laws.
- How these distinctions may impact your company.
- Practical suggestions on how to manage sales and use tax obligations 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 two times a year, once in the spring in South Dakota and when in the fall in North Dakota. An overall 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 requested. If a specific attends both seminars, or a complete 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 differences in between SD and ND tax laws.
- How the differences in between state tax laws may affect your business.
- Practical pointers on how to handle sales and use tax obligations for both states.
- Streamline Sales Tax Project.
- Available resources.
- Filing returns

ND/SD Border Tax Seminar - Construction Contractors

Topics consist of:

- Requirements for registration in SD and MN.
- Differences in between SD and MN taxes for specialists.
- Prime and subcontractors.
- Point of tax.
- Special jurisdictions/tribal contracts.
- Owner furnished products.
- Qualified utilities.
- Filing returns

Find Upcoming Seminars

Sales Tax Rate Charts

In the past, company owner have asked if we could provide rate charts. For your benefit, we have actually put together charts for each of the present sales tax rates your business might require. The charts are offered under or Forms/ Resources page. We have actually likewise offered a link listed below.