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Most businesses starting in Connecticut that are 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 find out who needs a sales tax permit, what products and services are taxable, how to register for a permit and reporting requirements.
Who needs a sales tax permit in Connecticut?
The following activities will require a business to register for a sales tax permit:
- 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?
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.
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
- Locksmith services
- Building maintenance
- Manicures and pedicures
- Massage therapy
- Storage facilities
- 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 by mailing in the REG-1 form. A business with multiple locations will need a sales tax permit for each location.
Information needed to register includes:
- Type of business entity (Sole Proprietorship, Partnership, Corporation, 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), or SSN if a sole proprietorship with no employees
- Names, addresses, phone, SSN and date of birth of owners/officers/members
- Employee information
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 your 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 Department of Revenue Services.
There is no cost to renew.
Sales tax reporting
How is sales tax collected?
When a business makes a sale of a taxable product or service, the business charges the appropriate sales tax rate to the customer. This tax is collected by the business who then sends it to the Connecticut Department of Revenue Services.
How much sales tax is 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 volume of annual sales, 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 the last day of the month following the reporting period, unless that day falls on a weekend or federal holiday, in which case 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 occurred.
Sales tax on purchases for resale
A business is able to 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 completed Connecticut Resale Certificate to document the items being purchased are for resale.
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
10 Middle Street
Bridgeport, CT 06604
401 West Thames Street, Building #700
Norwich, CT 06360
55 West Main Street, Suite 100
Waterbury, CT 06702