If you’ve ever wondered, “Does Georgia collect sales tax on out-of-state purchases?”, the short answer is yes—under specific conditions. Georgia enforces both sales and use tax laws that apply to remote sellers who cross certain economic thresholds or have physical presence in the state. For e-commerce businesses, SaaS providers, and other out-of-state vendors, understanding Georgia’s tax rules isn’t optional—it’s essential for avoiding penalties and staying compliant.
In this guide, we’ll walk you through nexus laws, registration steps, exemptions, local rate differences, and how sales tax experts like Hands Off Sales Tax (HOST) can help you get it right from day one.
How Georgia Taxes Out‑of‑State Sales
Georgia’s sales and use tax framework applies even to purchases made from out‑of‑state sellers—particularly those delivering goods into the state.
Sales vs. Use Tax
Georgia taxes both outbound and inbound sales of tangible personal property. If a remote seller doesn’t collect sales tax, the purchaser must self-report the use tax due. Georgia’s rules ensure consumption in-state is taxed regardless of where the seller operates.
Taxable Items & Scope
The law covers tangible personal property and certain taxable services when delivered or consumed in Georgia—even if the seller is based elsewhere. Non-taxable services and digital goods like software-as-a-service (SaaS) are generally exempt unless they include taxable tangible components.
Remote Seller Responsibility
Under Georgia’s destination-based sourcing rules, remote sellers must charge the combined state and local tax rate based on the shipping address of the buyer. That ensures accurate taxation aligned with the customer’s location, not the seller’s.
Buyer vs. Seller Liability
- If the seller is registered and collecting, they should collect sales tax at checkout.
- If not, the buyer is responsible for remitting use tax directly to Georgia. State law makes no distinction based on seller location.
It’s essential for remote sellers to understand that Georgia’s tax authority extends to any in-state delivery of tangible goods—regardless of whether the seller is located in the state.
Economic & Physical Nexus Rules for Remote Sellers
Georgia applies both economic and physical nexus standards to determine when out-of-state sellers must register and collect sales tax.
Economic Nexus Thresholds
Effective January 1, 2020, Georgia requires remote sellers to register if they exceed $100,000 in gross sales or 200 separate transactions in the current or previous calendar year. Prior to that, from January 1, 2019, thresholds were $250,000 or 200 transactions. Marketplace facilitator sales are excluded from these thresholds for individual sellers.
Physical Nexus Criteria
Physical presence continues to create a tax obligation. Georgia considers factors such as:
- Owning or leasing an office, warehouse, or distribution center in the state
- Storing inventory in Georgia under your control (including via third-party fulfillment, such as Amazon FBA)
- Having employees, contractors, or representatives operating within the state
- Participating in trade shows or convention sales activities (even temporarily)
These activities trigger immediate registration and collection responsibilities.
Timing & Registration Triggers
You must register for a Georgia sales tax permit by the time you make the first taxable sale after exceeding nexus, or as soon as you establish physical nexus. Registration is completed through Georgia’s online portal, the Georgia Tax Center.
Why It Matters
If you meet economic or physical nexus thresholds and fail to register, you become liable for past-period sales tax liabilities, interest, and penalties. Georgia’s DOR actively enforces these rules, and audit risk increases significantly once nexus is established. Clear nexus practices are essential to avoid compliance gaps.
Remote Seller Responsibilities
If you’re selling into Georgia and meet nexus thresholds, these are your core responsibilities to stay compliant:
Register for a Sales & Use Tax Certificate
Out-of-state sellers must register for Georgia’s sales & use tax certificate via the Georgia Tax Center, using Registration Form ST‑3. Remote sellers who exceed nexus thresholds—$100,000 in sales or 200 transactions—must complete this registration regardless of physical presence.
Include Taxable Shipping & Handling
Georgia law requires sales tax on shipping, delivery, freight, and handling charges when tied to taxable tangible goods—even if the fee is separately stated on invoices. If the goods themselves are exempt, then the shipping may also be exempt. Otherwise, the full shipping charge is taxable.
Filing Frequency and Zero Returns
Once registered, the Georgia Department of Revenue assigns your filing frequency—typically monthly, quarterly, or annual—based on your expected liability. Filing must be through the Tax Center or with Form ST‑3, and if no sales occur during a period, you must still submit a zero return to remain in good standing.
Businesses that collect over $500 in tax in a filing period are required to file and pay electronically. Avoiding zero‑return submissions or filing late can lead to penalties or loss of vendor’s compensation.
Current Rates and Local Add‑Ons
Georgia’s base state sales tax rate is 4%, but local jurisdictions can impose additional taxes—resulting in combined rates ranging from 4% to 9% depending on location Avalara+9Avalara+9Commenda+9. The average combined rate across the state is approximately 7.38%.
Examples of Local Rates
- Fulton County (Atlanta metro area): includes an extra 3% county-level tax, plus additional municipal options—bringing total rates in Atlanta up to 8.9% in some ZIP codes.
- Cobb County: levies a 2% local tax, resulting in a 6% total rate when combined with the 4% state tax.
Determining Exact Rates by Delivery Address
Georgia uses destination-based sourcing, meaning the tax rate is based on the customer’s delivery location. Rates can vary not just by county, but by city, special district taxes, or even roadway projects like SPLOST and municipal-option sales taxes.
To collect the correct amount, remote sellers should use a reliable rate lookup tool or ZIP-code tax calculator. This ensures the state tax plus precise local add-ons are applied accurately depending on the shipping ZIP code.
Key Exemptions, Use Tax & Complications
Georgia offers several standard exemptions that remote sellers need to understand, along with responsibilities tied to use tax when collection fails:
Exemptions for Resale & Nonprofits
- Purchases made for resale are exempt if the buyer presents a valid Georgia Sales Tax Certificate of Exemption (Form ST‑5), which retailers must retain as proof to avoid liability.
- Georgia’s statutes grant limited exemptions to specific entities—such as nonprofit hospitals, private schools, religious institutions, and charitable organizations—as outlined in official DOR rules.
- Most nonprofit groups not meeting these criteria remain taxable.
Use Tax Responsibility
When a remote seller does not collect Georgia sales tax, the buyer is liable for remitting use tax directly to Georgia. This ensures consumption in Georgia doesn’t escape taxation, regardless of seller location. Buyers must report and pay use tax on their Georgia returns when tax wasn’t collected at purchase.
Trade Show & Temporary Physical Presence Exemption
Out-of-state vendors registering solely for events like trade shows may be exempt if:
- Attendance is limited to no more than 5 days in a 12-month period, and
- Gross income from such activities in Georgia remains under $100,000 during the prior calendar year.
If those conditions are exceeded, standard sales tax obligations apply, including immediate registration and collection at the event.
These rules highlight how remote sellers must carefully track exemption documentation, monitor buyer liability for uncollected tax, and understand temporary physical presence limits to avoid unexpected compliance issues.
Common Pitfalls Remote Sellers Face
Georgia’s sales tax rules for remote sellers are nuanced, and it’s easy to make mistakes. Here are the most common pitfalls—and how to avoid them.
Misunderstanding Nexus Thresholds
Many sellers don’t realize that Georgia’s $100,000 economic nexus threshold is based on gross sales, not just taxable sales. Once you cross that limit, you must register and begin collecting tax—immediately.
Applying Incorrect Rates
Georgia uses destination-based sourcing, so the sales tax rate depends on the delivery ZIP code. Applying a flat state rate (4%) or ignoring local add-ons can lead to under-collection and penalties.
Overlooking Taxable Shipping
Sellers often forget that shipping and handling charges are taxable in Georgia when tied to taxable goods. Even if listed separately on the invoice, they’re still subject to tax.
Missing Zero-Return Filings
If you’re registered but have no sales in a given period, you’re still required to file a return showing $0. Missing these filings can result in fines and interest.
Marketplace Confusion
Transactions processed by a registered marketplace facilitator should not be counted toward your nexus threshold, nor should you collect tax on them directly. Failing to separate these can lead to over-reporting or audit red flags.
Simplify Georgia Sales Tax Compliance with HOST
Navigating Georgia’s out-of-state sales tax rules is anything but simple. Between economic nexus thresholds, ZIP-code-based rates, use tax responsibilities, and local filing quirks, even experienced remote sellers can make costly mistakes. That’s where Hands Off Sales Tax (HOST) comes in.
HOST is a full-service partner that helps remote and multi-state businesses stay compliant with sales tax regulations across all U.S. states—including Georgia. For e-commerce, SaaS, DTC, and wholesale sellers, HOST takes the guesswork out of tax obligations so you can stay focused on growth.
HOST Services That Support Remote Sellers in Georgia:
- Nexus Monitoring & Threshold Tracking: Know exactly when you’ve triggered economic nexus—and what to do next.
- Sales Tax Registration & Licensing: HOST handles Georgia ST-3 registration and other required forms, accurately and on time.
- Rate Calculations by ZIP Code: HOST applies the correct combined state and local tax rates based on the buyer’s delivery address.
- Filing & Remittance: Monthly, quarterly, or annually—HOST ensures your Georgia sales tax returns are filed accurately and on schedule, even when sales are zero.
- Audit Response & Notice Handling: If Georgia’s Department of Revenue reaches out, HOST handles the communication and defense.
When compliance is complex, HOST makes it hands-off.
Final Thoughts: Out-of-State Doesn’t Mean Out of Reach
So, does Georgia collect sales tax on out-of-state purchases? Absolutely—if you meet economic or physical nexus thresholds, you’re required to register, collect, and file. With variable local rates, complex exemptions, and strict enforcement, remote sellers can’t afford to get it wrong. Whether you’re just approaching the $100K threshold or already shipping regularly into Georgia, staying compliant is non-negotiable. That’s where Hands Off Sales Tax (HOST) can help—offering complete sales tax support so you can operate in Georgia (and beyond) without the stress. Get started today and let HOST take sales tax off your plate.
Frequently Asked Questions (FAQ)
1. Does Georgia collect sales tax on out-of-state purchases?
Yes. Georgia requires out-of-state sellers to collect and remit sales tax if they exceed $100,000 in gross sales or 200 separate transactions into the state. If the seller doesn’t collect tax, the buyer must self-report use tax.
2. What is Georgia’s economic nexus threshold for remote sellers?
Remote sellers must register if they exceed $100,000 in gross sales or 200 transactions in the current or previous calendar year. This threshold applies only to direct sales, excluding those made through a registered marketplace facilitator.
3. Do I need to collect tax on shipping charges to Georgia?
Yes. Shipping and handling charges are taxable in Georgia if they are associated with the sale of taxable tangible goods, even when listed separately on invoices.
4. What if I make no sales in a filing period?
Even if you have no sales, you’re still required to file a zero return for each active filing period. Failure to do so may result in penalties or loss of good standing.
5. Can a trade show trigger sales tax obligations in Georgia?
Yes, but there’s an exemption. If your trade show presence lasts fewer than 5 days and generates under $100,000 in gross income, you may qualify for exemption from registration and collection duties.
