New Jersey Sales Tax Guide
Chapter 5: Filing and paying New Jersey sales tax
You're registered with the Division of Taxation and you've begun collecting sales tax. Congratulations! Remember, those tax dollars don't belong to you. As an agent of the state of New Jersey, your role is that of intermediary transferring tax dollars from consumers to state and local tax authorities. Let's take a deeper look at how filing New Jersey sales tax returns impacts your business.What does it mean to file an New Jersey sales tax return?
Technically speaking, filing New Jersey sales tax returns is a two-step process comprised of submitting the required sales data and remitting the collected tax dollars (if any) to state and local tax authorities.
In most states, there are a number of options for submitting sales tax data to the state. Business owners may complete a New Jersey sales tax filing form and mail it to the Division of Taxation or they can file electronically online. In all states, filing online is recommended.
The filing process forces the business owner to detail their total sales, the amount of sales tax they have collected, and from where. The Division of Taxation wants to be kept up to date on your business growth (or lack thereof) to make sure they are getting the tax dollars due. By completing ongoing filing of monthly, quarterly, or semi-annual, or annual New Jersey sales tax returns, they stay abreast of your growing company.When am I required to file my sales tax return?
The Division of Taxation will assign you a filing frequency. Typically, this is determined by the size of your business. State governments typically ask larger businesses to file more frequently. Visit our New Jersey filing due dates page for more information.Am I required to file and pay my New Jersey sales tax at the same time?
New Jersey sales tax returns must be filed and paid at the same time and are governed by the same due date.I want to webfile my New Jersey sales tax. What are my options?
Avalara has built the TrustFile product to allow business owners a quick and easy way to prepare and webfile New Jersey sales tax returns. Users can sign up and use the service to prepare New Jersey returns free for 30-days.
Filers may also file directly with the Division of Taxation by visiting their site and entering your transaction data manually. This is a free service, but preparing New Jersey sales tax (breaking it down by jurisdiction) can be time consuming - especially for larger sellers.Can a 3rd party file my sales tax on my behalf?
Yes! Many business owners recognize they are not a tax professional and therefore, choose to outsource their sales tax sales and use tax filing to services like Avalara TrustFile or to an accountant or bookkeeper. This is a normal business practice that can save business owners time and help them avoid costly mistakes due to inexperience and a lack of deep knowledge about New Jersey sales tax code.What happens if I file or pay my sales tax return late?
Filing or paying New Jersey sales tax after the assigned deadline may result in the following penalties:
The late filing penalty is 5% of the tax due for each month or part of a month the return is late (multiple by 0.05). The maximum penalty for late filing is 25% of the late taxes. A penalty of $100 for each month the return is late may also be charged above and beyond the percentage penalty.
When payments are submitted late, a payment penalty of 5% of the tax due may also be charged.
Interest is calculated at the annual rate of 3% above the prime rate for every month or part of a month the tax is remains unpaid, compounded annually. In the event that outstanding taxes, penalties, and interest remain unpaid at the end of the calendar year, the outstanding balance becomes part of the balance on which interest is charged.Do I need to file a return if I didn't collect any sales tax in New Jersey?
Yes! Once you've successfully registered for and been issued a Certificate of Authority, you are required to file at the completion of each assigned collection period regardless of whether any sales tax was collected. This is what is known as a "zero-tax filing".
Failure to submit a required zero-tax filing can result in penalties imposed on your business by the Division of Taxation so don't take this responsibility lightly.If I close my business, do I need to file a final sales tax return?
Yes! The Division of Taxation requires all businesses to "close their books" by filing a final sales tax return. This also holds true for business owners selling or otherwise transferring ownership of their business.Does the Division of Taxation offer a discount for filing on time?
At this time, the Division of Taxation does not offer sales tax filers a vendor discount.