In Hawaii, you must deposit and transfer general excise duty monthly, quarterly, or annually. All Hawaiian excise tax reporting periods fall on the 20th day of the month, unless it is a weekend or federal holiday, in which case the deadline is extended to the next business day. Below is a list of this year`s registration deadlines: With a resale certificate, also known as a reseller permit, your business does not have to pay excise duty when purchasing products for resale. ** Note: Hawaii requires you to file a general excise tax return, even if you do not have an excise tax to report. This guide simplifies compliance with Hawaii`s general excise tax legislation by breaking down the process into four simple steps: Hawaii`s GE tax is generally broader than a typical sales tax, but the total rates are also much lower than a typical state`s sales tax. It`s common for Hawaiian companies to pass on their excise duties to their customers, but it`s not mandatory. Businesses must pay their excise duty, whether or not they charge a fee to their customers. In addition, businesses can charge customers more than the general rate of excise duty up to a maximum of 4.166% or 4.712% if your business is located in the city and county of Honolulu, Oahu. After you get approval from your seller and start your business, you need to determine how much excise tax you need to charge different customers. In most states, the frequency with which you file the general excise tax is based on the amount of general excise duty you collect from buyers in the state.
Most businesses with a presence in Hawaii, including the provision of services, are likely to be subject to general excise duties. Hawaii defines commercial activity in its General Excise Tax Act, Chapter 237-2 (begins at p. 4 of this link). Hawaii requires businesses to file general excise tax returns and excise tax payments online. For traditional entrepreneurs who sell goods or services locally, the calculation of the general excise duty is simple: all sales are taxed at the rate based on the location of the store. Services in Hawaii are also generally subject to general excise duties. Hawaii does not have a sales tax, but a general excise tax (GET). The sales tax is a tax for consumers because a general excise tax is a tax on the businesses themselves.
VAT must be levied by businesses, unlike the general excise duty. If you have determined that you must impose an excise tax on some or all of the goods and services sold by your business, your next step is to register for a seller`s licence. This allows your business to impose an excise tax on behalf of your local and state governments. A super easy guide to Hawaii GE (General Excise Tax). Learn what you need to know about these taxes. Hawaii`s general excise returns are always due on the 20th of the month following the reporting period. If the bid due date falls on a weekend or holiday, the general excise duty is usually due on the next business day. When calculating the general excise tax, you need to consider three types of sales: Steve runs his own business that sells electronics on eBay from his home in Kaneohe, Hawaii.
A customer who lives in Mililani, Hawaii, finds Steve`s eBay page and buys a pair of $350 headphones. When calculating sales tax on this purchase, Steve applies the state tax rate of 4.0% for Hawaii plus 0.5% for Honolulu County. With a total sales tax rate of 4.5%, the total cost is $365.75 (excise tax of $15.75). When you declare and pay Hawaii, the general excise tax depends on two things: the frequency of production assigned to you and the state`s due dates. Small business income, self-employed business income, self-employed income, retail revenue, service revenue, commissions, rent payments received and many other types of income are subject to excise duty. Even if you can`t pay, the collection department will work with you on a payment plan. While it`s uncomfortable to think that you owe hundreds or thousands of taxes, it`s usually not the end of the world and it`s not worth losing too much sleep. So we suggest you submit and face the inevitable.
Note that this generally does not apply to « income tax » – but « GE Tax » is completely separate and the tax is taxed differently. files.hawaii.gov/tax/legal/brochures/Res_RP_brochure.pdf The number of times you need to file a return depends on the total amount of general excise duty charged by your business. Certain services in Hawaii are subject to excise duty. A detailed list of taxable services can be found in this PDF on the Hawaii Department of Taxation website. Mary owns and operates a bookstore in Kapolei, Hawaii. Because books are taxable in the state of Hawaii, Mary charges her customers a flat excise tax of 4.5% on all sales. These include the State of Hawaii excise tax rate of 4.0% and the Honolulu County excise tax rate of 0.5%. Mary could charge up to 4.712% to cover her TOARG costs.
The normal processing time for post-in or walk-in applications is 10 to 15 business days. For online applications, you will receive an email with the General Excise Identification Number within three to five days and after this process, you should receive your licence within one week. Last but not least, while sales tax is due on retail sales of tangible personal property, GET is due for all business transactions, even if you sell to another business (a transaction that would generally not be taxable with a sales and use tax in other U.S. states). In Hawaii, most tangible products are subject to their general excise duty. There are tax-exempt items, such as medical devices and prescription drugs. The State of Hawaii pursues a destination-based excise tax policy. This means that distance sales in Hawaii are taxed based on the buyer`s address.
This policy applies to state, county, and city excise taxes. You apply by completing the GE BB-1 tax form. Be sure to look for the most up-to-date form, as Hawaii recently revamped the form and some links lead to outdated Hawaiian government websites. Hello, we are resellers and only the sale to the federal government or other resellers with the federal government is the end user. I know that our sales are exempt and go directly to the federal government, but what about sales that go through an additional reseller? I hope that makes sense! Thank you very much! Now that you`ve signed up for approval for a seller in Hawaii and know how to charge all your customers the right amount of sales tax, you can file your sales tax return. Just make sure you meet all registration deadlines to avoid penalties and fines. I did Lyft for 2 months in 2018 and have stopped since then because it wasn`t a big win. I did my taxes today and found out that I had to have a GE license to do Lyft.
I don`t intend to remake Lyft in the coming years. Do I still need to apply for a GE license even if I no longer do so? I am confused. I`ve sent the money I owe to the state of Hawaii for taxes, but I don`t know if I still have to apply for a GE license or not if I stop doing Lyft. Unfortunately, the instructions are not very clear. Disclaimer: Please do not stick to the accuracy of this answer – this is a loaded question and the answer may depend on many factors. To be sure, please contact a tax specialist or accountant who knows your entire tax situation (or you can hire us 🙂) New in hawaii Tax Return. called customer service and listened to the annual deposit as a non-resident I can take Federal Schedule C Net and apply it to Federal. It sounds simple, but when you fill out the annual form, you only have the location for income and exemptions. Just need basic direction. Hello – sorry, but we can`t tell taxpayers how to fill out the forms. We used to do this, but we were blamed for penalties and time costs to fix things due to misunderstandings.