If your limited liability company (LLC) sells physical products or certain types of services, you will need to collect and pay sales tax. In Texas, the first step is visiting the comptroller’s website and registering for sales tax in order to acquire a seller’s permit, or sales tax permit.
What Products and Services Are Subject to Sales Tax in Texas?
Goods for sale, lease, or rental are subject to sales tax in Texas. Services that are taxable include remodelling and repairs of real property, amusement services, insurance services, personal services, and many others. Most food and health-related items are sales tax exempt in Texas.
Texas Sales Tax Rate
The sales tax rate in Texas is 6.25%.
Five states have no sales tax. Colorado has the lowest sales tax at 2.9%, while California has the highest rate at 7.25%.
How to Register for Texas Sales Tax
In Texas, acquire a seller’s permit by following the state comptroller’s detailed instructions for registration:
- Register for an account on the comptroller’s website.
- Fill out the seller’s permit application.
- There is no fee to apply for a seller’s permit in Texas.
Use our Sales Tax Calculator to calculate taxes and total purchase amount.
In Texas, and across the country, collecting sales tax is a must if you want to avoid potentially heavy fines and even closure. It’s crucial that you follow your state’s laws, and you might consider consulting with an accountant or tax attorney to make sure you’re in full compliance.