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Background
Originally effective Sept. 1, 2015 through March 13, 2019, Washington adopted a click-through presumption of nexus standard for both retailing B&O tax and retail sales tax purposes.
However, after March 13, 2019, businesses should refer to our New nexus standard for retailing B&O tax page to determine if they have nexus in Washington.
Prior presumption of nexus for click-through retail transactions
Under the original click-through provisions, out-of-state retailers were presumed to have physical nexus with this state if they:
- entered into agreements with Washington residents and paid a commission or other consideration for referrals (such as linking on a website), and
- grossed more than $10,000 in sales into Washington during the prior calendar year under this type of agreement.
The definition of Washington resident includes, but is not limited to, business entities physically located in this state and individuals maintaining a residence in this state. In addition to online or other referral arrangements, an out-of-state retailer may engage in other activities in this state through a resident or nonresident agent or other representative that establish nexus with this state. For additional information, please see the Out-of-state businesses guide page.
Register your business
Businesses with nexus in Washington state are required to register, collect sales tax and pay B&O tax.
Rebuttal process
A business may rebut the presumption of click-through nexus by showing that (i) each in-state person with whom the remote seller has an agreement is prohibited from engaging in solicitation activities in this state that refer potential customers to the remote seller, and (ii) such in-state person or persons have complied with that prohibition. The presumption of click-through nexus may also be rebutted by any other means as may be approved by the department.
Request a tax ruling
If you are unsure of your tax reporting and payment requirements, you may submit a written request to the Department for a tax ruling.
Submit a Voluntary Disclosure application
If you are concerned that you should have been registered and paying tax for prior periods, you may take advantage of the state’s Voluntary Disclosure Program.
Learn more
Read the entire law.
Questions?
If you have questions email us at Rulings@dor.wa.gov.
