Physical Nexus in the USA

Accounting & Taxes
1

Hello! I have set up an online store selling Eco friendly Tote bags and I am currently based in the UK. Printful is acting as my supplier and fulfillment partner. They have a fulfilment centre in Dallas, Texas in the USA. They will be printing and shipping my products on my behalf.
I have no direct control as I do not have employees or my own warehouse in Dallas, Texas in the USA. And I am not storing my own goods there independently. Printful is responsible for the logistics and storage of the products within their fulfillment center. I will be using Printful as print on demand and not to stock any products that I own in their warehouses. Printful is acting as my agent producing the product and sending directly to customers in the USA. I also do not have any fixed place in Dallas, Texas in the USA.
I need to understand based on all the above, if I have a physical nexus with Dallas, Texas in the USA and therefore I need to register straight away for VAT this state in the USA. I am so confused and this stops me from selling in the USA at the moment…
Thanks a lot in advance for your time and support!

2

@CarbonWhat You do not have a physical nexus in Texas. So, You do not need to register for turnover tax in Texas unless you have more than $ 500,000 on sale there. The printful collects sales tax on your behalf and misses the turnover fee where necessary.
If you start reaching high sales, you need to monitor the economic Nexus thresholds in various US states.

1 Like
3

Thanks a lot for your answer! So does this mean that I can start selling in the USA market without registering anywhere there for VAT and will only need to register once I reach the economic nexus in each individual state?

4

Yes, you can start selling in the USA market without registering for VAT (VAT doesn’t apply in the U.S.). And you will only need to register once you reach the economic nexus in each state. Set up Shopify tax settings to ensure tax is charged where required (optional if using Printful for tax collection).

1 Like
5

This is great, many thanks for your time and support!