Ohio sales tax guide and calculator for businesses

Navigating Ohio’s sales tax guidelines

Each state mandates specific directives that explain when a business must file sales tax returns. What are Ohio’s economic thresholds, and how do they impact when a business must remit sales tax payments to the state? TaxJar’s sales tax guide and calculator offers simple guidance to help businesses and remote sellers estimate their tax liabilities and gain clarity about Ohio’s economic thresholds and sales tax filing guidelines.

Do you need to collect sales tax in Ohio?

You’ll need to collect sales tax in Ohio if you have either a physical or economic nexus. Businesses with a physical nexus have a tangible presence or activity in a state. Businesses or remote sellers that have an economic nexus meet a state’s economic threshold for total revenue or the number of transactions in that state.

Do you have physical nexus in Ohio?

Ohio considers a seller to have physical nexus if they : 

• offer a place of business within this state, whether operated by employees or agents of the seller, by a member of an affiliated group of which the seller is a member, or by a franchisee using a trade name of the seller
• have employees, agents, representatives, solicitors, installers, repair people, salespeople, or other individuals in Ohio for the purpose of conducting its business
• employ a person in the state for the purpose of receiving or processing orders of its goods or services
• make regular deliveries of tangible personal property into this state by means other than common carrier (For example, the out-of-state seller has goods delivered to this state in vehicles which the out-of-state seller owns, rents, leases, uses, or maintains or has goods delivered by another member of an affiliated group, of which the out-of-state seller is a part, acting as a representative of the out-of-state seller)
• own tangible personal property that is rented or leased to a consumer in this state, or offers tangible personal property, on approval, to consumers in this state
• own, rents, leases, maintains, or has the right to use and uses tangible personal or real property that is physically located in this state
• are registered with the Secretary of State to do business in this state or are registered or licensed by any state agency, board, or commission to transact business in this state or to make sales to persons in this state
• make more than $500,000 in sales in the state and uses a software or content delivery network in the state  The Ohio Department of Revenue provides additional insights about what constitutes sales tax nexus in Ohio.

Do you have economic nexus in Ohio?

Effective August 1, 2019, Ohio considers vendors who make more than $100,000 in sales annually in the state or more than 200 separate transactions into the state in the current or last calendar year to have economic nexus. These vendors  must collect sales tax from buyers in the state. Ohio provides an FAQ with economic nexus guidance for sellers.

What is the Ohio state sales tax rate?

The Ohio state sales tax rate is 5.75%. Local sales tax rates may also apply.

Is what you’re selling taxable?

Many services in Ohio are taxable.  Contact the Ohio Department of Revenue if you are unsure whether or not what you sell is taxable. 

Tangible products are generally taxable in Ohio, with a few exceptions. These exceptions include certain foods, prescription drugs, some building materials and more. The Ohio Department of Taxation offers a list of non-taxable tangible goods.

Is SaaS taxable in Ohio?

SaaS is taxable for business use in Ohio and non-taxable for personal use.

How to get a sales tax permit in Ohio

You can register for an Ohio sales tax permit online or with TaxJar’s assistance. 

• Register online at the Ohio Business Gateway.
• In-state based sellers: Choose “County Vendor’s license.”
• Out-of-state based sellers: Choose “ Ohio Taxation – New Account Registration and Fuel Permit” and then Choose “Sellers Registration.”

Businesses also can visit our registration page to request that TaxJar manage your Ohio registration for you.

 Businesses need the following information to register for a sales tax permit in Ohio:

• Business identification information
• Business entity
• Locations
• Date you will begin collecting Ohio sales tax
• NAICS Code

For sellers located in Ohio, an Ohio sales tax permit (form ST-1, called a vendor’s permit) includes a  $25 fee, and you must pay via ACH debit. For “remote sellers” (sellers located outside of Ohio but required to collect sales tax in Ohio due to sales tax nexus), form UT-1000 is free.

Collecting sales tax

The sales tax rate you collect in Ohio depends on whether you are based in Ohio or out-of-state.

How to collect sales tax in Ohio if you are based in Ohio

Ohio is an origin-based sales tax state. So if you live in Ohio, collecting sales tax is fairly easy. Collect sales tax at the tax rate where your business is located. The state sales tax rate (and use tax rate) in Ohio is 5.75%.

You can research  your local sales and use tax rates with TaxJar’s Sales Tax Calculator. In Akron, for example, there’s a total sales tax rate of 6.75% – due to an additional 1% due for sales in Summit County.

If you have more than one location in Ohio, then you would base the sales tax rate you charge on the point of origin of your sale.

How to collect sales tax in Ohio if you are not based in Ohio

Ohio wants sellers who made sales into Ohio from outside the state to charge sales tax based on the destination of the buyer.

Should you collect sales tax on shipping charges in Ohio?

Ohio considers delivery charges as part of the price of a sale. Therefore, shipping charges are taxable.

When are returns due?

When you file and pay Ohio sales tax depends on your assigned filing frequency and your state’s due dates.

How often will you file sales tax returns in Ohio?

States assign you a filing frequency when you register for your sales tax permit. In most states, how often you file sales tax is based on the amount of sales tax you collect from buyers in the state.

In Ohio, you will be required to file and remit sales tax either monthly or semiannually.

Ohio sales tax returns are generally always due the 23rd day of the month following the reporting period. If the filing due date falls on a weekend or holiday, sales tax is generally due the next business day.

Filing sales tax

Filing sales taxes in Ohio includes three simple steps: 

1. 1. Calculate how much sales tax you owe
   2. File a sales tax return
   3. Make a payment

How to calculate how much sales tax you owe in Ohio

Calculating how much sales tax your business should remit to the state of Ohio is easy with TaxJar’s Ohio sales tax report. Connect the channels through which you sell — including Amazon, eBay, Shopify, Square and more — and TaxJar will calculate exactly how much sales tax you collected. All the information you need to file your Ohio sales tax return will be waiting for you in TaxJar.

How to file and pay sales tax in Ohio

You have three options for filing and paying your Ohio sales tax:

• File online – The state of Ohio requires merchants to file sales tax online. You can file sales tax online via the Ohio Department of Taxation, and remit your payment through their online system. 
• File by mail – FIll out form UST-1, though Ohio encourages sellers to file online
• AutoFile – Let TaxJar file your sales tax for you. We take care of the payments, too. You’ll never have to worry about spreadsheets, calculations or filling out complex sales tax returns.