How do I register my tax-exempt status with Hostway or change my taxation Nexus address?
To register your tax-exempt status, please forward you state or federally issued certificate of tax exempt status to email@example.com.
Can I use my address of incorporation as my taxation Nexus address?
Yes, this is a perfectly reasonable taxation Nexus address; however, we recommend that you confirm this with your own legal counsel to ensure it is the right choice for your specific situation.
How will taxes appear on my invoice? Will I receive a separate invoice for the sales taxes?
The relevant sales taxes will be listed as individual line items for each applicable tax jurisdiction. These individual sales tax items are listed at the bottom of the invoice after the Sub-Total for the invoice. Please note that some service items may have different sales tax rates depending on the rules of each tax jurisdiction. If you have questions about specific tax rates, please contact your Account Manager.
When will the application of sales tax start appearing on my invoices?
Hostway has not determined when this change will occur; however, it will happen before the end of 2019 and we will communicate this date once it has been confirmed.
Is it possible for me to opt out of paying sales tax through Hostway?
The only way to opt out of the sales tax charge is to qualify as a tax-exempt entity under your Nexus state’s rules. In order to qualify, you will need to provide documentation from the state that verifies your tax-exempt status. This documentation will need to be kept up-to-date as each certificate expires.
Why is Hostway beginning to collect sales tax? Why didn’t you collect sales tax before?
In response to the June 21, 2018 US Supreme Court ruling South Dakota v. Wayfair, Inc., it is now necessary to collect the applicable sales tax for goods and services that are delivered into any tax jurisdiction. Additionally, a policy change on the part of Hostway dictates that because the goods and services are being delivered to your Nexus location rather than being provided through our physical and/or incorporation location, the logic around how the sales taxes are applied has changed. These changes are being implemented at this specific time because we are in the process of integrating the Hostway and HOSTING operations, making this an efficient and appropriate time to apply this new functionality. Please note that customers in certain jurisdictions may have previously been charged use taxes, but these are different from the new sales tax charge.
What is my tax liability?
Your tax liability will be dictated by your Nexus location. In most cases, you will be paying the same sales tax you would as if you were purchasing goods and services physically at your location. There may be some adjustments in the actual tax liabilities for specific types of goods and services and how they are delivered. We are using the Avalara AvaTax service to provide a completely up-to-date view into the intricacies of the various tax jurisdictions and their associated rules.
Will I have to pay any historical sales tax burden for invoices prior to this implementation?
No. We will not be invoicing or collecting sales tax for invoices sent prior to the implementation date.
Do I really need to pay sales tax on Hostway services? I haven’t paid it in the past!
Yes. The current MSA that governs our delivery of our goods and services includes provision for the collection of applicable sales/use tax. We are merely changing our policy on whether we are collecting those applicable sales taxes. Please note that any sales tax we collect is paid to the applicable taxation authority and does not affect profitability.