Mississippi Sales Tax
Whether your business operates in Mississippi or ships goods into the state, it is essential to be aware of sales tax regulations.
The state of Mississippi has a 7% sales tax rate. In addition, there is a 6% use tax on purchases made from out-of-state vendors. Nonprofit organizations and religious institutions are exempt from sales tax. Whether you’re required to collect sales tax in Mississippi is determined by having a commercial connection, known as nexus, in the state. This includes having a store, an office, a warehouse, storage space, or an employee in the state.
Nexus is the term that defines a significant commercial connection with a state, and it determines whether you are required to collect and remit sales tax for the state. In order to have nexus in Mississippi, you must sell tangible products or services to customers in the state or have a physical presence there. This includes having a store, warehouse, distribution center, office, employees, or storage space.
Businesses that are required to collect Mississippi sales tax must remit the collected taxes to the state on a regular basis. Typically, this is done monthly or quarterly, depending on the size of the business and its sales volume. The returns must detail the total sales in the state, the collected tax, and any exemptions claimed.
Mississippi Sales Tax Registration
Whether you sell online or in-person, it’s important to register for sales tax in Mississippi. Not only does this help you abide by state regulations, but it also instills confidence in customers and partners. Plus, it can lead to tax deductions for expenses related to the business.
To register, visit the Taxpayer Access Point (TAP) website and select “Register a New Business.” Enter your business information and click “Submit” to submit your application. The Department of Revenue will assign you a filing frequency, which can be monthly, quarterly, or annually. Returns are due on the 20th day of the month following a reporting period unless it falls on a weekend or federal holiday.
In addition to registering for sales tax, small businesses should also consider registering for use tax and employer withholding tax. This is especially true if you have a physical store in the state or own inventory in Mississippi. Using a sales tax calculator can help you determine your taxable status, apply the correct rate, and file timely returns. A sales tax consultant can also offer ongoing support to ensure you stay compliant.
How to File Mississippi Sales Tax?
You must file a sales tax return every month. You can file online using the Mississippi TAP system. You should keep a copy of your filed return and payment for your records. If you have customers who claim sales tax exemptions, be sure to collect a valid Mississippi sales tax exemption certificate. These certificates can be submitted to the state during a sales tax audit. Be sure to keep them well-organized and easily accessible.
