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How To Register For A Tennessee Sales Tax Permit

How To Register For A Tennessee Sales Tax Permit

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How To Register For A Tennessee Sales Tax Permit

Most businesses starting in Tennessee that are selling a product or offering certain services will need to register for a Tennessee sales tax permit.  This permit is also referred to as a seller’s permit, sales tax license, sales tax number, or sales tax registration.   

Check out the rest of this guide to determine who needs a Tennessee sales tax permit, what products and services are taxable, how to register for a permit, and reporting requirements.

Also See: Guide to starting a business in Tennessee

Who needs a sales tax permit in Tennessee?

A business must register for a sales tax permit in Tennessee when:

  • A business has an economic nexus. Economic nexus means having a physical presence in the state, such as having a physical location like a retail store or office or using a warehouse or fulfillment center to store inventory.
  • Making retail sales or selling taxable services in Tennessee.
  • Hiring employees based in Tennessee (including sales representatives or agents).
  • An online business located in Tennessee is selling taxable products to Tennessee residents.
  • A remote seller or an out-of-state business selling over $500,000 of taxable products and services to Tennessee residents.

Tangible personal property is defined as items that can be seen, weighed, measured, felt, or touched. Pre-written computer software is also considered tangible personal property.

What products and services are taxable in Tennessee?

Physical products

There are a few exceptions, but almost all physical products are taxable when sold at retail in the state of Tennessee. Common examples include:

  • General merchandise like furniture, appliances, and clothing
  • Titled or registered items like vehicles

Digital Products

Digital products are taxable in Tennessee.

Services

Most services aren’t taxable in Tennessee, however, there are a few exceptions, some of which include:

  • Short-term lodging
  • Providing repair to tangible personal property or computer software
  • Laundering or cleaning of any tangible personal property
  • Installation of computer software

A full list of taxable services in Tennessee is available from the Department of Revenue (TNDOR).

How to register for a sales tax permit in Tennessee

A sales tax permit can be obtained by registering through the Tennessee Taxpayer Access Point (TNTAP) or mailing in the Application for Registration.

Information needed to register includes:

Sales tax reporting

How is sales tax collected?

When a business sells a taxable product or service, the business charges the appropriate sales tax rate to the customer. This tax is collected by the business, which then sends it to the Tennessee Department of Revenue.

How much sales tax is charged?

If the purchase is made at a store or in a mobile location, the sales tax rate varies depending on where the sale took place in Tennessee. In addition to the statewide sales tax, city and/or county governments may add additional sales taxes. When shipping in-state, the sales tax is based on the purchaser’s address.

To find sales tax rates, see sales tax rates by address from the Tennessee Department of Revenue.

When are Tennessee sales tax returns due?

The Department of Revenue will determine a filing frequency based on the expected sales volume, which will be monthly, quarterly, or annually.

The deadline for filing is the 20th day of the month following the reporting period unless the 20th falls on a weekend or federal holiday, which would move to the next business day. Penalties and interest will be assessed for late filings.

Even if the business had no sales during the reporting period, a filing is still required indicating no sales occurred.

Tennessee Sales Tax Permit FAQs

How much does a Tennessee sales tax permit cost?

There is no cost for a sales tax permit in Tennessee.

How long does it take to get a sales tax permit in Tennessee?

Expect 1-2 business days to receive a sales tax permit when registering online or up to 2 weeks when applying by mail.

After you register, the Department of Revenue will send you a Certificate of Registration that you must display at your business location.

Do you have to renew a Tennessee sales tax permit?

The sales tax permit is a one-time registration, and no renewals are needed. Be mindful that if any information about the business changes, such as the mailing address, additional locations, or change in ownership, those changes need to be updated with the Department of Revenue.

Is a business license the same thing as a sales tax permit?

No – A business license and a sales tax permit are not the same thing. Here’s how they differ:

A business license gives you the right to operate your business in a specific area, while a sales tax permit allows you to collect sales tax from your customers on behalf of the state.
In many cases, a business will need both.

Learn what business licenses are needed in Tennessee

How do I get a wholesale license in Tennessee?

A business can purchase items to resell without paying state sales tax. The tax liability is passed from the wholesaler or vendor to the retailer, who will then charge sales tax to the end-user of the item.

Wholesalers and distributors will require a sales tax number and a completed Tennessee Certificate of Resale (also referred to as a Tennessee seller’s permit, resale certificate, wholesale license, or sales tax exemption certificate) to document that the items being purchased are for resale.

When retailers register for a Tennessee sales and use tax account, they are automatically issued a Tennessee Sales and Use Tax Certificate of Resale.

If you have questions about the sales tax permit, the Tennessee Department of Revenue has a Sales & Use Tax Guide, or they can be contacted by calling 800-342-1003.

How To Register For A Tennessee Sales Tax Permit

How To Register For A Tennessee Sales Tax Permit

6 Responses

  1. My wife is wanting to sell homemade products and some products purchased from suppliers at a small vendor mall. She will not sell the items directly to customers. The customers will take their purchases to a central cashier to pay. The owners of the mall will collect the sales tax and my wife will get paid as a 1099 contractor once a month. What kind of licenses or permits will she need to have in Tennessee to do business this we and not have to pay sales tax to suppliers? Thank you.

    1. Hi Dieter – Thanks for your question. Typically, the operator of the vendor location will collect the sales tax as you describe and also collect a small fee in lieu of a business tax. If your wife has sales that exceed $10,000 in gross sales each year, she’d want to get a business license. Sales averaging $400 a month that are not collected by the dealer would mean she’d need to register for sales tax.

      It sounds like she isn’t doing enough to require registration at this time. I hope this helps!

  2. Hi, Greg!
    I would like to purchase glass ornaments at wholesale prices for my crafts that I resell. What do I need to be able to
    do this? Thank you! Jane

    1. Hi Jane!

      Your first step is registering for the Tennessee Sales Tax Permit (https://tntap.tn.gov/eservices/) on the Tennesse Taxpayer Access Point (TNTAP). This permit allows you to sell your ornaments and collect sales tax. After registering, you will automatically be issued a Tennessee Sales and Use Tax Certificate of Resale.

      You will need to ask the vendors that you purchase your ornament supplies from that you want to tax free. They will ask you for the Certificate of Resale, so you will just download it from your TNTAP account, and send it to them!

      Here is some more in-depth information from the state that may be helpful as well -https://www.tn.gov/content/dam/tn/revenue/documents/taxguides/salesanduse.pdf

      Hope this helps!
      Greg

  3. Hey I am very interested in starting and need insight please help me , I just lost my mom and I have four big kids, I need all the money I can get !!! I have always been good at buying and selling so this is where I looked into please help me thanks

    1. Hi Amanda – I’m sorry to hear about your mom. Some businesses take longer to start than others and it sounds like you need to start something quickly. I have a few resources that may help and maybe there is an idea that will help today while you work on something else that may be bigger/take a little longer.
      List of different types of businesses
      50 home-based businesses that you can start today
      Resources from other sites
      Work at home jobs
      75 ways to make money from home

      I hope these are a good start, but let me know if you have any other questions.
      Thanks!
      Greg

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