Author: Sara Britt

The Supreme Court’s landmark decision in South Dakota v. Wayfair, et al. on June 21, 2018, spoke for the states when it overruled the “physical presence” standard long held in Quill Corp. v. North Dakota — changing the game for sales tax collection.

The decision stands to affect all types of businesses in various industries and locations throughout the world. Below are some key questions and answers that will help you understand the impact and potential risks to your business, and what you should do next.

Read more: 6 Things You Need to Know About Wayfair and Its Impact on Your Sales Tax Obligations

Author: David Prichard

Online retail may be a booming industry as more and more of us are choosing to shop online, however for many Australian business who ship their products worldwide this sector brings many additional considerations and vulnerabilities.

One of these is being subject to the ever-changing sales tax laws that govern the country in which their customers reside where the onus is on the business to ensure that the correct sales tax applied. While this may seem simple enough when shipping to a country with a sales tax such as the GST which is applied nationwide, in countries where sales taxes are stipulated state by state ensuring that the correct tax is applied can be more complex and if you’re an Australian business shipping to the US this complexity is likely to increase.

Read more: US Ruling on Sales Taxes brings additional complexity for online Australian retailers

Author: Ray Polantz

As a result of the Tax Cuts and Jobs Act (TCJA), U.S. shareholders of controlled foreign corporations (CFCs) could see a significant change in their tax bill beginning in 2018 — and not for the better. Absent strategic tax planning efforts, the new law will currently tax global intangible low-taxed income, or GILTI.

The GILTI provisions are some of the most significant steps taken by the TCJA to broaden the U.S. tax base and prevent taxpayers from shifting value outside the U.S. borders, namely through holding intangible assets, such as patents and tradenames, in foreign subsidiaries. However, the provisions are much broader and also cover “soft” intangibles like workforce in place and general know-how.

Read more: 3 GILTI Planning Options Non-C Corporations Should Consider Before Year-End

Author: Fuad S. Saba

Congress introduced the GILTI tax with the TCJA at the end of 2017.  The tax applies to tax years beginning after December 31, 2017. GILTI is defined as the income of a “Controlled Foreign Corporation” (CFC) that exceeds the CFC’s “net deemed tangible income return.”  The latter is defined as a 10% return on the tax basis of the tangible assets of the CFC that are used in the CFC’s business, adjusted for the CFC’s interest expense.  Thus, the term GILTI is a misnomer because any CFC that earns a relatively high return on its business assets can have GILTI, even if intangible assets are not directly a factor in the production of its income.  Note that the GILTI tax applies with respect to the annual income of a CFC regardless of any distributions of that income by the CFC.

Read more: Do You Have a “GILTI” Tax for 2018, and What Are You Doing About It?

Author: Jeffrey Brown

In the shadow of the recent Wayfair decision, more and more Canadian remote sellers now have to deal with state and local sales tax collection responsibilities. All too many are still thinking they can play the catch me if you can game, erroneously citing the US Canada Tax Treaty or assuming the states can’t or won’t come to Canada for enforcement. In my 15 plus years advising clients in Canada, I’ve represented many clients in state sales tax audits and enforcement actions. Not only do they come to Canada, they love to come to Canada, not just for poutine, but for cross-border tax enforcement.

Sales tax compliance can be a costly pain in the butt. Registering as a vendor in each state. Securing exemption certificates from customers who insist they’re not subject to tax. Computing the amount of tax to collect from customers. And not just state taxes; often and more confusingly, local sales taxes as well. Paying over collected taxes to the authorities. Filing tax returns.

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