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Nexus Doing Business California （ Nexus ）

If you are starting a business in the state of California, you should know about Nexus.

Nexus （ Nexus ）" means a sufficient nexus between the state and the business to impose sales tax （ sales tax ）. If this nexus exists, the company is obligated to collect ・ and pay sales tax to that state. California also requires out-of-state businesses to collect and pay sales tax if certain conditions are met.

There are three main types of Sales Tax Nexus in California ：
1. Physical Nexus （ Physical Nexus ）
・ A store, warehouse, or office in California, Physical Nexus
・ Has employees, agents, or sales persons in the state
・ Stores goods in California
・ Exhibits at trade shows or conducts sales activities in the state
→ If this is the case, the Sales Tax obligation is immediately triggered, regardless of the size of the sales.

2. Economic Nexus （ Economic Nexus ）
The requirement in California is that if sales in California exceed $ 500,000 in a year, Sales Tax must be paid even if you have no physical presence in the state. There are no criteria for
or quantity （ of sales ）. Only the monetary criterion applies. For example, whether you have 100 or 10,000 cases, $ you will get a nexus if you exceed 500,000.

3. Marketplace Facilitator Nexus （ Marketplace Nexus ）
If you sell through marketplaces such as Amazon or eBay （ starting in 2020 , the marketplace （ such as Amazon ） will collect Sales Tax on your behalf ・ and you will be required to pay it ・, but if you sell from your own site, you will be required to pay it.
*At the same time, the seller must file his/her own Sales Tax. *Please be careful if you sell directly through your own e-commerce site at the same time.

Registration of Sales Tax ・ The process of payment is as follows.
・ Apply for Sales Tax Permit to California Department of Tax and Fee Administration (CDTFA)
・ File monthly/quarterly/annually ・ Pay tax （ Depending on size Frequency varies ）
・ Electronic filing ・ ACH payment and other methods available for payment

*Note ： Tax rates vary by county ・ city, so please check in advance.