From January 1, 2023, we will be adding US State Sales Tax to the payments that US-based customers make when buying from BrightLocal.
Which US States does this apply to?
We are required to apply US State Sales Tax to payments coming from businesses located in the following US states:
- New Mexico
- North Carolina
- South Carolina
- South Dakota
N.B. Some states consider SaaS a taxable service while others don't, hence for some states the tax applied will be zero. Also, the tax rate will vary depending on the county and city each business is located in.
We anticipate that with further growth of our business, at some point in 2023 we will cross the sales tax thresholds (aka "economic nexus") threshold in other states, and so will need to add sales tax from that date forward for customers in those states.
Which products and services does this apply to?
We are required to apply sales tax to all payments made to BrightLocal; this includes monthly and annual subscriptions, Citation Builder campaigns, Citation Builder credits, and all other credit purchases.
What do I need to do?
For future payments, the percentage and US$ amount of sales tax added will be clearly displayed on all BrightLocal payment forms and invoices where applicable.
For pre-existing subscriptions, you won't need to take any action. Sales tax will be added automatically and collected as part of your next recurring payment.
The only action you'll need to take right now is to confirm that we have the correct billing address for your business. It's to ensure you're incurring the correct rate of sales tax. To do that, please head over to the Payment Details page in your BrightLocal account and confirm the details.
What state does BrightLocal think my business is located in?
We determine your state based on address information gathered from either of two sources:
- Address provided by you when you set up your BrightLocal account
- Address linked to your credit/debit card or PayPal account
You can confirm and/or edit your billing address on the Payment Details page. All customers will be required to do this before January 1st to ensure they incur the correct State Sales Tax for their business.
What if my business is tax exempt?
If your business is exempt from paying state sales tax, we can prevent sales tax from being added to your payments.
In order for us to do this, you will need to provide us with an official exemption certificate: just email the BrightLocal finance team from the email address you use to log in to BrightLocal and attach the certificate to the email, and we'll do the rest.