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Sales and Use Tax

• iFile Sales and Use Tax Returns
• Web Upload Sales and Use Tax Returns
• Retail Sales Tax
• Electronic Funds Transfer
• Non-Prescription Drugs (PDF 14 Kb)
• Penalty and Interest
• Federal Government Credit Card Purchases
• Retail Sales & Use Tax: Exemption for Internet Service Providers
• Register for a Sales and Use Tax Account
• Direct Pay Permit
• Consumer Use Tax for Businesses
• Sales Tax Holidays
• Diplomatic Exemption

Retail Sales Tax

A seller is subject to the sales tax imposed on gross receipts from retail sales. "Retail sales" means sales made for any purpose other than for resale. The tax may also apply to the furnishing of transient accommodations and the lease or rental of personal property.

The seller collects the tax from the customer on each sale. The tax must be separately stated and added to the sales price or charge. The general sales tax rate is 5% (4% state tax and 1% local tax). In Bulletin 5-78, sales of eligible food items are subject to a reduced state tax rate of 2.5%( 1.5% state tax and 1% local tax) effective July 1, 2005.

Beginning July 1, 1998, Virginia Tax Bulletin 98-4 (PDF 14 Kb) exempted nonprescription drugs and proprietary medicines from state sales and use tax.

Businesses subject to sales tax must submit a monthly return to the department on form ST-9 (PDF 958 Kb) by the 20th of the following month whether or not the business has had taxable sales for the month. Out-of-state sellers should submit their monthly sales tax report on Form ST-8 (PDF 1.61 Mb) by the 20th of the following month whether or not the business has had taxable sales for the month. Registered businesses receive Form ST-4, Certificate of Registration. Businesses must prominently display Form ST-4 at the registered location.

If form ST-9 (PDF 958 Kb) is not available and the sales tax due date is near, you should file an informal report of your company's sales tax transactions containing the following information:

• Your business name
• Your Virginia tax identification number
• Your business address
• The fact that this form is for sales tax and the period it covers
• The amount of your gross receipts
• The amount of sales tax due

Based on your tax liability, the department may change your filing frequency from monthly to quarterly. You will be notified if we change your company's filing frequency.

You will automatically be mailed forms preprinted with your account information unless you file electronically using our iFile application, or use tax software to prepare your returns.

Businesses must submit Form ST-9 (PDF 958 Kb) with payment to:

Department of Taxation
Post Office Box 26626
Richmond, Virginia
23261-6626

To request the form, please contact our Customer Services Office at (804) 367-8037.

Business registration information is available at Registering Your Business. To file and pay sales and use tax online, registered businesses may signup at VATAX Online for Businesses.

2004 Sales and Use Tax Rate Increase Guidelines (PDF 90 Kb)

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Penalty and Interest

If you fail to file or pay the full amount of sales tax due by the due date, a penalty of 6% per month is added to the tax owed. The maximum penalty is 30%, and the minimum penalty is $10.00. The minimum penalty applies to late returns even if there is no tax owed.

Interest is added at the federal underpayment rate plus 2%. We apply the interest to an account until the tax is paid.

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Direct Pay Permit (ST-6, ST-6A, and ST-6B PDF 1.13 Mb)

Mail Form ST-6 (PDF 1.13 Mb) along with your payment to the following address:

Department of Taxation
P.O. Box 26627
Richmond, Virginia 23261-6627

A Direct Payment Permit is issued on the condition that the holder will file returns with the Department and allocate the local tax so that no county or city will lose any revenue because of the issuance of the permit. Form ST-6 (PDF 1.13 Mb) is used to report and pay the tax. Form ST-6B (PDF 1.13 Mb) is used to allocate the 1% local tax and must be filed with Form ST-6 (PDF 1.13 Mb). The worksheet, Form ST-6A (PDF 1.13 Mb), should be kept with your tax records.

Filing Procedure

ST-6 returns and ST-6B schedules (PDF 1.13 Mb) are due no later that the 20th day of the following month after the close of the reporting period. A return must be filed for each reporting period even if no tax is due.

Questions

If you have questions about Direct Pay Permits or how to file these returns, please call (804) 367-8037.

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Consumer Use Tax for Businesses (ST-7 PDF 132 Kb)

The use tax applies to the use, consumption or storage of tangible personal property in Virginia when the Virginia sales or use tax was not paid at the time of purchase. The use tax is computed on the cost price of the property, which is the total amount for which the property was purchased, including any services that are a part of the purchase, valued in money or otherwise, and includes any amount for which credit is given the purchaser or lessee by the seller.

Mail with Form ST-7 and Form ST-6B (PDF 132 Kb), if applicable, with your payment to the following address:

Department of Taxation
P.O. Box 26626
Richmond, Virginia 23261-6626

This return is due by the 20th day of the following month after the close of the reporting period. Returns are not required to be filed for periods in which no use tax is due.

If you have questions concerning this tax or how to file the returns, please call (804) 367-8037.