Ohio: Sales Tax Handbook
What constitutes sales tax nexus in Ohio?
One of the more complicated aspects of Ohio sales tax law is sales tax nexus, the determination of whether a particular sale took place within the taxation jurisdiction of Ohio, and is thus subject to state (and possibly local) sales taxes.
If a vendor's transactions are determined to have nexus in Ohio, the vendor must register for a Ohio sales tax license and collect appropriate sales taxes from the buyer for all transactions with nexus in the state. On this page, we have compiled some of the most commonly needed facts about what constitutes sales tax nexus in Ohio.
Sales Tax Nexus in Ohio
According to the state of Ohio's laws, all retailers who have tax nexus can be defined in several different ways.
If your business has anyplace of business within the state that is either managed by agents or employees of the seller or a franchisee using the sellerÃƒÂ¢Ã¢â€šÂ¬Ã¢â€žÂ¢s trade name, any employees, representatives, agents, installers or sells people within the state for the purpose of conducting business, or if the seller is able to make regular deliveries of tangible personal property into the state by means of common carrier, you are considered to have tax nexus in Ohio.
For additional details on sales tax nexus law in Ohio, see the nexus information page from the Department of Taxation at http://www.tax.ohio.gov/sales_and_use/faqs/sales_basics.aspx
Taxation of Internet-Based Sales in Ohio
NOTE: 2018 Supreme Court Ruling Regarding Online Sales Taxes
In the 2018 Supreme Court case South Dakota vs. Wayfair Inc, Et Al., the court overturned a previous ruling that required a merchant to have physical nexus in order for a state to collect sales tax. This means that any state is now free to enforce collection of sales taxes on out-of-state online merchants. The information provided here may be subject to change, and many states are expected to begin collecting online sales taxes following this ruling.
Generally, Ohio does not charge sales tax on Internet-based transactions determined to have nexus within the state. This means that purchases from Amazon.com and other Internet-based retailers may be sales-tax-free.
The nexus status and taxability of Internet-based sales, by vendors and/or consumers within Ohio, have been the subject of hot debate in recent years. You can learn more on our introduction to Internet-based sales taxes.
Does my business have tax nexus in Ohio?
The folks at the sales tax compliance company Avalara are an approved Ohio sales tax partner, and you can use their free Ohio nexus wizard tool to determine whether or not your business has nexus, and is therefore required to pay Ohio sales taxes. If you're interested in automating your sales tax collection and filing process, click here to get more information.
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