Ask IH: When did you start collecting sales tax for your US-based SaaS?
How are you handling collecting sales tax for your SaaS in the US, if at all? If you are collecting sales tax, at revenue point did you start?
For some context, the law is that companies need to collect sales tax wherever they have a physical presence in the US.
Whether you should charge sales tax in each state will depend on a few things:
The difficulty with the “nexus” definition is that it is state-by-state specific, and can be defined through a number of factors, such as: physical presence, quantity of sales, or owning property within that state. Overall, this is a very complicated area of law right now with everything changing – driven primarily by Amazon and the rise of e-commerce.
Stripe actually has some cool integrations with helpful providers for this very annoying topic, check out https://stripe.com/docs/orders/tax-integration
Can't speak for US-based business, but here in Canada I started on day 1. First subscription had taxes on it.
The reason? As a customer, when I receive an invoice without any tax information, I am scared of that business.