Delaware Sales Tax For Photographers

by Dec 31, 2020Sales Tax

To begin you have to ask yourself 3 questions…


DEFINITIONS

let’s first take a look at what each of these sale tax terms means so that you can understand how it pertains to Photographers in Delaware.
These definitions are laid out below.


👉NEXUS

So, what’s nexus? The term “nexus” is used in tax law to describe a situation in which a business has a tax presence in a particular state. A nexus is basically a connection between the taxing authority and a business that must collect or pay the tax. It’s possible to have nexus in more than one state especially if you travel to another state to shoot. So you want to be sure you understand the laws of each state you work in.


👉SOURCE

The source indicates where the sales are taxed.

  • Origin-sourced sales are taxed where the seller is located, so this is based on your zip code.
  • Destination-sourced sales are taxed at the location where the buyer takes possession of the item sold.

Also, keep in mind if the client picks up tangible goods from your location or studio, this is the point where the transaction happens. If you mail or ship to the client, it will be by their zip, not yours.


👉PHYSICAL GOODS

Any physical products sold to a client, items you can touch and hold like prints, albums, frames, etc…


👉DIGITAL GOODS

These are digital items delivered electronically via telephone lines, over the internet, by email, or by another alternative form of non-physical transmission.
Beware of digital prints delivered on a physical device such as a thumb drive or CD as these are no longer digital and are now considered physical because you can touch them.
Services are anything needed to produce the end product, such as shooting, editing, culling, touchup, etc…


👉SERVICES

Services are anything needed to produce the end product, such as shooting, editing, culling, touchup, etc…


👉SHIPPING

This is any shipping charged by you to your client. Third parties such as album companies who dropship or online
galleries where clients can order prints will take care of their own shipping. But if you charge your client shipping,
this is where the shipping rules in this guide apply to you.


Delaware Sales Tax for Photographers

Below are the sales tax requirements for Photographers in Delaware broken out. You will find supporting links and resources at the bottom of this post.


✅GROSS RECEIPTS TAX (GRT)

Delaware doesn’t impose a state sales tax, but it does have an annual business license requirement, and it imposes a gross receipts tax on the seller of goods or provider of services. Sales of tangible personal property are also subject to a retail or wholesaler license and gross receipts tax.

Delaware Department of Revenue States photographers are required to obtain a business license of $75 for the first location and $25 for each additional location, which must be renewed annually on or before December 31st of each year.

Transient photographers must pay the $75 annual license fee plus a fee of $25 per day for each day worked in Delaware.

Additionally, every photographer must pay a gross receipts tax at the rate of .3983% (.003983) on taxable amounts received from services provided.

The first $100,000 of gross receipts received per month ($300,000 quarterly) are exempt from the gross receipts tax.


📆Monthly

Due 20th of the following month

📆Quarterly

PERIOD/DUE

Q1 (JAN – MAR) / APR30
Q2 (APR – JUN) /JUL31
Q3 (JUL – SEP) / OCT31
Q4 (OCT – DEC) /JAN31*(Following year)

New licensees will file on a quarterly basis through their first calendar year. The Division of Revenue will then perform a “lookback” procedure and determine if the filing frequency should be changed.


LINKS

Delaware Division of Revenue

⭐️Tax Tips for Photographers in Delaware
⭐️Delaware Department of Revenue – Learn about gross receipts tax


Have another question you’d like me to add to this list?

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– Tiffany Bastian

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