Pennsylvania Tax Nexus
Businesses with nexus in Pennsylvania are required to register with the Pennsylvania Department of Revenue and to charge, collect and remit the appropriate tax.
Generally, a business has nexus in Pennsylvania when it has a physical presence there, such as a retail store, warehouse, inventory, or the regular presence of traveling salespeople or representatives. However, out-of-state sellers can also establish nexus in the ways described below.
Pennsylvania nexus for out-of-state sellers
The Department of Revenue, after “carefully reviewing the United States Supreme Court’s decisions, and also reviewing the manner in which many remote sellers currently operate,” has come up with examples of remote seller activity that constitute nexus. These include, but aren’t limited to:
- Storing property or the property of a representative at a distribution or fulfillment center located within the Commonwealth, regardless of whether the center also stores property of third parties that is distributed from the same location
- Having a contractual relationship with an entity or individual physically located in Pennsylvania whose website has a link that encourages purchasers to place orders with the remote sellers, and the in-state entity or individual receives consideration for the contractual relationship with the remote seller
- Utilizing affiliates, agents and/or independent contractors located in Pennsylvania to provide repair, delivery or other service relating to tangible personal property sold by the remote seller to Pennsylvania customers
- Having affiliates, agents and/or independent contractors provide service(s) within the Commonwealth (including, but not limited to storage, delivery, marketing or soliciting sales) that benefit, support and/or complement the remote seller’s business activity
- Having employee(s) regularly travel to Pennsylvania for any purpose related to the remote seller’s business activity
- Accepting orders that are directly shipped to Pennsylvania customers from a Pennsylvania facility that is operated by a remote seller’s affiliate, agent or independent contractor
- Regularly soliciting orders from Pennsylvania customers via the website of an entity or individual physically located in Pennsylvania, such as via click-through technology
See Sales and Use Tax Bulletin 2011-01 Remote Seller Nexus; Pennsylvania Tax Obligations for Out-of-State Vendors; and Revenue Department Offers One-Time Extension on Nexus Compliance Deadline for Remote Sellers.