Adhering businesses to sales tax compliance is an important aspect in a state like Idaho, especially where there are unique tax regulations. Ensuring compliance with Idaho sales and use tax will not only keep your business on track but also help avoid costly penalties. Here, in this blog, you will come to know about some actionable insights that help you to keep your business compliant with sales tax Idaho in 2025

Understand the concept of Idaho sales tax

Idaho imposes a statewide sales tax rate of 6% on the sale of all kinds of tangible goods, properties and certain services. Along with base sales tax rate, an additional local sales tax rate of 3% is added and therefore the combined sales tax rate rises to 9%. In Idaho, sales tax is applicable on retail sales, short-term rental accommodation and digital goods. Some specific professional services are also subject to sales tax Idaho. However, services like digital subscriptions, consulting or repairs are non-taxable. Businesses must determine whether they have nexus because this triggers the obligations to collect and remit sales tax to the government

Establish Nexus in Idaho

Nexus can be both physical and economic. Physical nexus includes a warehouse, an office, employees or inventory in Idaho. Economic nexus is applicable to businesses exceeding $100,000 in annual sales to Idaho customers. If your business doesn’t have a physical presence and conducts all its business transactions via online, you have to apply for a registration to obtain a sales tax permit. Therefore, it can rightly be said that understanding Nexus protocols is the first step to keeping your business compliant

Register for sales tax permit

To collect and remit sales to the government of Idaho, you have to register for a sales tax permit. Registration is free and the process of obtaining a sales tax permit is seamless. All you need is your business name, SSN and EIN and other important details about your products or services. Once you get the permit, you can submit your online account for timely tax submission

Collecting and remitting sales tax

As a business owner, collecting sales tax from customers and remitting it to the government is the prime requirement for every business to fulfil. Since the state of Idaho follows a destination-based sales tax rate, it is important to stay updated with the local sales tax rates that vary from place to place. At TAX 365, we provide an online sales tax calculator that lets you calculate sales tax based on your area pin code. This is an extremely easy procedure. All you have to do is to enter your area pin code and you will be provided with the accurate sales tax rate of your area that you need to collect and remit to the government. It is compulsory for all businesses operating in Idaho to collect and remit sales to the government

Exemptions

Not all goods or services are subject to Idaho sales tax. There are certain goods and services that are exempted from sales tax, and they include grocery products, prescription medicines, agricultural items etc. On the other non -profit organizations are also exempted from paying sales to the government. However, they are liable to produce proper documents in respect of it to obtain this exemption.  Noncompliance may lead to huge penalties. Therefore, it is important for all businesses to stay compliant with sales tax regulatory protocols.

Simplifying Compliance

Staying compliant can be a complex process but with the help of certain tools like Idaho sales tax calculator can simplify calculations, filings and multi-state compliance. Tax 365 ensures seamless online tax filing with all kinds of paperwork assistance. They will also keep you updated with the Idaho sales tax protocols from time to time