Frequently we engage with New Zealand businesses on the topic of liability to state sales tax and state income tax. 

When engaging in a trade or business within the United States it is not too long before these thorny issues arise.

The gravity that an organization has in terms of these liabilities is known as ‘nexus’.

The states’ abilities to tax individuals and organizations is a hot topic in the United States currently. This is becoming increasingly important because individual states are thirsty for new customers.

Nexus is a way for them to find new customers, and increase their revenue base.

Separate rules

It is very important to distinguish between nexus for income tax purposes, and nexus for sales tax purposes.

Sales tax is a separate nexus tax issue to that of state income tax, with separate rules, and separate case law.

In the first of our white paper series, we have produced a paper on state sales tax and state income tax nexus.

To find out more please contact us.