How to Register for a Sales Tax License in Pennsylvania
Most businesses starting in Pennsylvania selling a product or offering certain services will need to register for a sales tax license. This is commonly referred to as a seller’s permit, sales tax permit, sales tax number, or sales tax registration.
The sales tax license is obtained through the Pennsylvania Department of Revenue as a part of the Pennsylvania Enterprise Registration. In addition to registering for sales taxes, this registration is used to register a new business and withholding taxes.
Check out the rest of this guide to determine who needs a sales tax license, what products and services are taxable, how to register for a permit, and reporting requirements.
Also See: Guide to Starting a Business in Pennsylvania
Who needs a sales tax license in Pennsylvania?
A business must register for a sales tax license in Pennsylvania when:
- A business has 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.
- Selling products and taxable services in Pennsylvania (includes occasionally selling items at craft shows, fairs, seminars, shows, etc.)
- Employees (including sales representatives or agents) are working in Pennsylvania
- An online business located in Pennsylvania is selling taxable products to Pennsylvania residents
- A remote seller or an out-of-state dealer selling over $100,000 in taxable goods and services to Pennsylvania residents.
What products and services are taxable in Pennsylvania?
Physical products
There are a few exceptions, but almost all physical products are taxable when sold at retail in Pennsylvania. Common examples include:
- General merchandise like furniture, appliances, and clothing
- Titled or registered items like vehicles
Drugs, medical supplies, grocery store food, and school textbooks are tax-exempt.
Labor, in most cases, isn’t taxable in the state of Pennsylvania. For instance, let’s say you broke the screen of your cell phone and take it to a cell phone repair shop to have it fixed. Sales tax would be added to the selling price of the new screen and any additional parts to fix the phone. The labor to replace the screen isn’t taxable. However, a business that makes furniture will indirectly have a sales tax on labor. In this instance, let’s say this business is building a dining room table for a customer. Through labor, the pieces of wood are shaped, sanded, and painted to build this piece of furniture. While the labor isn’t directly taxable, sales tax is charged to the final selling price of the table.
Digital Products
Most digital products are taxable in Pennsylvania.
Services
Most services aren’t taxable in Pennsylvania, however, there are a few exceptions, some of which include:
- Short-term lodging
- Secretarial or editing services such as letter writing, resume writing, or document editing
- Pest control services
- Building maintenance or cleaning services
- Self-storage services
- Lawn care services
See the full list of taxable items in Pennsylvania.
How to register for a sales tax license in Pennsylvania
A sales tax license and account number can be obtained by registering online with the Pennsylvania Department of Revenue’s myPATH website. This registration can also be used to register a business for employer withholdings through the Pennsylvania Department of Labor & Industry.
Information needed to register includes:
- Date operations began
- Fiscal year end of the business
- Federal Employer Identification Number (FEIN) from the IRS
- Business Legal Name
- Business Trade Name
- Business physical address and mailing address
- Doing Business As – if applicable
- Type of business entity: Sole Proprietorship, Partnership, Corporation, Limited Liability Company (LLC)
- Names, SSN, date of birth, title, and addresses of owners/officers/members
- Establishment’s business activities
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 is then sent to the Pennsylvania Department of Revenue using the E-tides filing.
How much is sales tax in Pennsylvania?
The sales tax rate that is charged varies depending on the address of the business if the purchase is made in the store. When shipping in-state, the sales tax is based on the address of the purchaser.
In addition to the statewide 6% sales tax, Allegheny and Philadelphia Counties levy additional taxes. More details on Pennsylvania sales tax rates is available from the PA Department of Revenue.
When are Pennsylvania 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. Generally, a business collecting between $200 and $8,333 each month will file monthly.
Filings are due on 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.
Even if the business had no sales during the reporting period, a filing is still required indicating no sales.
How much does a sales tax license cost in Pennsylvania?
There is no cost for a sales tax license in Pennsylvania.
How long does it take to get a Pennsylvania sales tax license?
Expect 24-48 hours to receive your Pennsylvania sales tax license.
Do you have to renew a Pennsylvania sales tax license?
The sales tax license is renewable every five years. 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.
How do I get a wholesale license in Pennsylvania?
A business can purchase items to resell without paying state sales tax. The tax liability is passed from the wholesaler or distributor 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 complete a Pennsylvania Sales Tax Exemption Certificate (also referred to as a wholesale license, seller’s permit, or resale certificate) to document the items being purchased are for resale.
Is a business license the same thing as a sales tax license?
In addition to registering for a sales tax permit, there may be other business licenses needed before starting a business in Pennsylvania.
Learn what business licenses are needed in Pennsylvania.
If you have questions about sales and use tax, the Pennsylvania Department of Revenue has the Retailer’s Information Guide, or call 717-787-3653.
5 Responses
What is the penalty for not applying for Sales Tax License when you start your business? What if we did not know that we had to? and Can we make a payment plan for the past sales tax due?
Hi Melissa – The penalty for past due sales tax is 5 percent per month from the date due until the date filed to a maximum of 25 percent (https://revenue-pa.custhelp.com/app/answers/detail/a_id/211/kw/penalty%20and%20interest%20calculator). You aren’t technically past due, so the Department of Revenue may be willing to work with you.
You can schedule a call with the PA Department of Revenue here – https://www.revenue.pa.gov/ContactUs/Pages/Callback.aspx
If I’m starting an online bakery, making and selling them out of my home do I need to collect sales tax. I have an LLC business name and an EIN already, but am I required to collect sales tax in Pennsylvania.
Hi Carol – Even though you are selling online, customers are picking up the items in Pennsylvania. So, you will need to register for the sales tax license and collect sales tax.
This guide from the Pennsylvania Department of Revenue has a ton of info to explain more – https://www.revenue.pa.gov/FormsandPublications/FormsforBusinesses/SUT/Documents/rev-717.pdf
Looking forward to your success! Let me know if you have any other questions!
Greg
Btw I’m not shipping my items, it’s either pick-up or delivery.