Everything You Need To Know About Sales Tax In Ohio
If you’re a business owner or consumer in Ohio, you should know all about sales tax in the state. While Ohio has a relatively low sales tax rate compared to many states, it’s important to understand when and how it applies. In this article, we’ll break down the basics of sales tax in Ohio to help you stay on top of your taxes.
What Is the Ohio Sales Tax Rate?
The Ohio sales tax rate is 5.75%. This is lower than many other states, including nearby states such as Michigan, Indiana, and Pennsylvania. This rate applies to most retail items sold in Ohio. However, some items may be subject to an additional local sales tax, which can vary from county to county.
Who Is Required to Collect Sales Tax in Ohio?
Business owners and sellers in Ohio are responsible for collecting and remitting sales taxes on items they sell. This includes both in-state and out-of-state sales. It’s important to note that this applies even if you don’t have a physical presence in the state. For example, if you sell items online to customers in Ohio, you must collect the appropriate sales taxes.
What Items Are Exempt From Sales Tax in Ohio?
Certain items are exempt from sales tax in Ohio. These include items such as groceries, prescription drugs, and most medical supplies. Additionally, certain types of clothing and footwear are exempt, such as items that are sold for less than $75.
How and When Should I Remit Sales Tax in Ohio?
The Ohio Department of Taxation requires businesses to remit sales taxes to the state on a monthly basis. Businesses must complete a tax return and submit payment by the 20th day of the following month. For example, if you’re remitting taxes for the month of January, your tax return and payment must be submitted by February 20th.
Can I Claim a Sales Tax Refund in Ohio?
In some cases, businesses may be eligible for a sales tax refund in Ohio. This may be the case if you’ve overpaid sales tax for the year or if you’ve made purchases for business purposes that are exempt from sales tax. To claim a refund, you must complete a sales tax refund application with the Ohio Department of Taxation.
What Are the Penalties for Not Paying Sales Tax in Ohio?
If you fail to file a sales tax return or pay the necessary taxes on time, you may be subject to penalties and interest. The exact amount of the penalty will depend on the amount of taxes owed and the amount of time the taxes were overdue. Additionally, if you fail to pay taxes for multiple periods, the Ohio Department of Taxation may take legal action against your business.
Where Can I Find More Information About Sales Tax in Ohio?
For more information about sales tax in Ohio, you can visit the Ohio Department of Taxation website. Here, you can find detailed information about filing requirements, sales tax rates, and more. Additionally, you can contact the Ohio Department of Taxation directly with any questions or concerns you may have.
Conclusion
Understanding Ohio’s sales tax laws is essential for business owners and consumers alike. Knowing the sales tax rate, when and how to remit taxes, and what items are exempt can help you stay on top of your taxes. Hopefully, this article has given you a better understanding of sales tax in Ohio.