If you are a neophyte in realm of online business, then perhaps you have a lot of questions that are plaguing your mind and one of them may be all about whether you are obliged to pay taxes for your online business or not.
Calculating and paying your duly taxes alone is t4 online already one confusing ride, and surely it will get more confusing if it will be mixed with an online business.
However, as they say, there’s no problem that cannot be solved. With just a few tips and guides, you can find out how to pay taxes for your online business without any hassles or problems along the way.
Before we talk about taxes and your online business, let’s discuss first why more and more people are getting attracted to starting their own online business.
Well, first of all, it is very hassle-free compared to having a business in the non-virtual world. You see, in online business, you only have to type and click for your business to boom.
Very minimal manual labor is needed in an online business and one can even get to work at home in their pajamas while managing their online business.
Now the question is: are online businessmen or entrepreneurs exempted from paying taxes? The answer is no. All individuals who are earning money online are required to pay taxes.
Sure, the government can’t possibly keep track of how much money each person generates online but then again, it’s one of the citizens’ responsibilities to go ahead and be responsible enough to pay for their taxes.
The Real Deal About Most Online Businesses
The truth is, not everybody who does business online is honestly paying their due taxes. Most online businesses include shopping and it’s a known fact that most if not all shoppers despise paying sales tax and adore a bargain that is luxuriously tax-free.
The Internet is actually considered to be a great venue for tax-free shopping which lures more and more customers each day. Online retailers have been using a no-tax shopping tag line to attract more online shoppers to their business.
Sounds like a win-win situation, right? Online shoppers enjoy numerous tax-free shopping sprees and online retailers don’t pay their taxes. Most people probably think that doing business through the Internet is considered to be tax-free.
However, the fact is, some Internet sales are actually subject to what we know as “sales tax” and online consumers are the ones often responsible to remit any unpaid sales tax on whatever online products they have purchased.
Collecting Sales Tax The process of determining whether you should pay taxes for your online business or not may be quite confusing and overwhelming – especially if it’s your first time to get involved in online business.
However, here are just some few tips you should remember: the obligation to pay the so-called “Sales Tax” can be determined by the location of the customers, and not the seller.
If a business does not actually have a physical presence in a particular state (an example of this would be your online store or business), it is not required to collect sales tax from costumers in that certain state.