Most businesses starting in Connecticut selling a product or offering certain services will need to register for a Sales and Use Tax Permit from the Connecticut Department of Revenue Services. This is commonly referred to as a resale number, 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 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 Connecticut
Who needs a sales tax permit in Connecticut?
The following activities will require a business to register for a sales tax permit:
- A business has sales tax nexus. 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, renting, or leasing goods (this includes flea markets, craft shows, antique shows, etc. even if the business will only be selling for one day)
- Providing a taxable service
- Building contractors (includes subcontractors)
- Operating a hotel, motel, B&B, or lodging house
- Out-of-state online businesses selling at least $250,000, over 200 or more sales to Connecticut residents, and having regular or systematic solicitation of sales in Connecticut.
- Hiring employees working in Connecticut
Connecticut imposes a pretty stiff penalty if a business sells taxable products and services without a sales tax permit. This penalty can result in a fine of $500 and/or three months in prison.
What products and services are taxable in Connecticut?
Physical products
There are a few exceptions, but almost all physical products are taxable when sold at retail in Connecticut. Common examples include:
- General merchandise like furniture or appliances
- Titled or registered items like vehicles
Non-prepared food, firearm locks, child car seats, college textbooks, prescriptions, and medical equipment are tax-exempt.
Services
Most services aren’t taxable in Connecticut, however, there are a few exceptions.
- Advertising and public relations services
- Car washes (includes coin-operated car washes)
- Computer and data processing services (consulting, feasibility studies, programming, software)
- Extermination services
- Health club, gym, yoga studio memberships, and classes
- Furniture reupholstering and repair
- Janitorial services
- Landscaping
- Locksmith services
- Building maintenance
- Manicures and pedicures
- Massage therapy
- Storage facilities
- Towing
- Painting
- Pet grooming and boarding
- Photography studios
- Private investigation
- Radio, television, and electronic repair
- Spa services
- Swimming pool cleaning and maintenance
- Window cleaning
A list of common sales tax exemptions in Connecticut is available from the Department of Revenue Services.
How to register for a sales tax permit in Connecticut
A sales tax permit can be obtained by registering through the Connecticut Taxpayer Services Center or mailing in the REG-1 form. A business with multiple locations will need a sales tax permit for each site.
Information needed to register includes:
- Type of business entity: Sole Proprietorship, Partnership, Corporation, Limited Liability Company (LLC)
- Nature of business activity (retailer, wholesaler, manufacturer, service provider)
- Description of business activities
- North American Industry Classification System (NAICS) code
- Business name and address
- Federal Employer Identification Number (FEIN) from the IRS, or the owner’s Social Security Number if a sole proprietorship with no employees
- Names, addresses, phone, SSN, and date of birth of owners/officers/members
- Employee information
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 company and then sends it to the Connecticut Department of Revenue Services.
How much is sales tax in Connecticut charged?
The sales tax rate for most products and services sold in Connecticut is 6.35%.
A full list of Connecticut sales tax rates is available from the Department of Revenue Services.
When are Connecticut sales tax returns due?
The Department of Revenue Services will determine a filing frequency based on the expected annual sales volume, which will be monthly, quarterly, or annually. Generally, a business selling over $1,300 monthly in taxable sales will file monthly. The frequency is re-evaluated annually.
Filings are due on the last day of the month following the reporting period, unless that day 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 permit cost in Connecticut?
A Sales and Use Tax Permit in Connecticut costs $100.
How long does it take to get a Connecticut sales tax permit?
Expect 15 business days to receive a sales tax permit when registering online or 2-3 weeks when applying by mail. A temporary sales tax permit will be provided immediately when applying online.
Do you have to renew the Connecticut sales tax permit?
The sales tax permit will need to be renewed every 2 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 Connecticut Department of Revenue Services.
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 Connecticut.
How do I get a wholesale license in Connecticut?
A business can purchase items to resell without paying state sales tax. The tax liability is passed from the 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 a completed Connecticut Resale Certificate to document that the items being purchased are for resale.
There is no cost to renew.
Questions
If you have questions about the sales tax permit, the Connecticut Department of Revenue Services has a guide to sales taxes in Connecticut or can be contacted by calling 800-297-5962.
Business owners can also visit a regional office.
Department of Revenue Services Main Office
450 Columbus Blvd.
Hartford, CT 06103
Bridgeport Office
10 Middle Street
Bridgeport, CT 06604
Norwich Office
401 West Thames Street, Building #700
Norwich, CT 06360
Waterbury Office
55 West Main Street, Suite 100
Waterbury, CT 06702
