Alabama Sales Tax Guide for eCommerce Businesses
Alabama Sales Tax Guide for eCommerce Businesses
Sales Tax eBook
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Alabama's Sales Tax Authority
State Phone Information
334-242-1170
Member of the Streamlined Sales Tax Governing Board?
No
Tax percent range for remote sellers in Alabama
8%
The information on this page is for reference only and should not be used as legal or tax advice. If you are concerned about your sales tax obligations it is advised to hire a professional.
This Page was last updated: December 2021
Do you need to collect sales tax in Alabama?
If you have nexus in Alabama, you will need to first register, then collect and remit sales tax. There are two main ways that sellers can have nexus: physical or economic.
Physical nexus - A seller physical/ tangible presence in the state.
Economic nexus - A remote seller (no physical presence) passes the threshold tor total revenue or number of transactions.
Does Alabama charge sales tax on shipping?
Sales tax on shipping is dependent on the method of delivery. The Alabama Department of Revenue sets out the regulations for sales tax on shipping and handling. (Alabama freight charges)
There are two requirements that need to be met that exempt a seller from charging sales tax on shipping and handling:
The seller must use the US postal service or a common carrier.
The charges for shipping and handling must be billed separately and be paid directly or indirectly by the purchaser.
If the seller delivers the goods using their own vehicle or if the freight charges are included in the purchase price then the seller is obligated to pay sales tax.
Do you have physical nexus in Alabama?
A seller has physical nexus in Alabama if they have any of the following:
An office or place of business such as a retail store
A warehouse or inventory stored in the state
Regular presence of traveling salespeople or other agents
Remote entity nexus (affiliate nexus)
Do you have economic nexus in Alabama?
Alabama's Economic Nexus Sales Threshold
$250,000
Economic Transactions Threshold
N/A
Economic Nexus Evaluation Period
Previous Calendar Year
Economics Nexus Effective Date
October 1, 2018
What types of sales are included in Alabama's Economic Nexus Sales Threshold?
Retail sales are included.
Marketplace sales made by individual sellers are excluded from the threshold.
How does Alabama treat exempt transactions when calculating economic nexus?
Exempt sales are included in the threshold. Exempt services and wholesale sales are not included.
Does Alabama have a Marketplace Facilitator Law?
Yes, Marketplace Facilitators are required to collect and remit sales tax on behalf of sellers on their platform.
Filling Sales Tax
When are Returns Due?
Alabama sales tax returns are due the 20th of the month following the reporting period. If the filing due date falls on a weekend or holiday, sales tax is generally due the next business day.
How often are Sales Tax Returns filed?
Monthly, Quarterly or Yearly
This period is determined by the state typically by assessing your volume of sales in the state.
Options for filing sales tax returns:
Online - The Alabama Department of Revenue requires that online sellers file sales tax online.
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