In general, all sales, leases, and rentals of tangible personal property in or for use in Virginia, as well as accommodations and certain taxable services, are subject to Virginia Sales and Use Tax, unless an exemption or exception is established.
Sales Tax Rates
|Hampton Roads||Northern Virginia||Historic Triangle||Everywhere Else|
|General Sales Tax Rate||6%||6%||7%||5.3%|
|Food for Home Consumption||2.5%||2.5%||2.5%||2.5%|
- Hampton Roads includes the Cities of Chesapeake, Franklin, Hampton, Newport News, Norfolk, Poquoson, Portsmouth, Suffolk and Virginia Beach, and the Counties of Isle of Wight and Southampton.
- Northern Virginia includes the Cities of Alexandria, Fairfax, Falls Church, Manassas, and Manassas Park; and the Counties of Arlington, Fairfax, Loudoun, and Prince William.
- Historic Triangle includes the City of Williamsburg, and the Counties of James City and York. For more information about the recent sales and use tax change, see Historic Triangle Regional Sales and Use Tax Increase.
Sales of aircraft, watercraft, and motor vehicles are taxed at different rates than those listed above. For more information about the Motor Vehicle Sales and Use Tax, please visit the Department of Motor Vehicles.
The Virginia Retail Sales and Use Act establishes a tax on the sale, lease, rental, or use or consumption of tangible personal property in Virginia, as well as taxable services in Virginia.
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. (Code of Virginia § 58.1-603).
The seller is responsible for collecting the tax from the customer on each taxable sale. The tax must be separately stated and added to the sales price or charge.
Any individual, firm, organization or business that meets the definition of "dealer" as set forth in Virginia law must register with Virginia Tax. A dealer is generally defined as a person or business engaged in the business of selling at retail or distributing tangible personal property in Virginia. The definition also applies to dealers who rent, lease or furnish items that are subject to the tax in Virginia, or who store such items for use or consumption in Virginia.
- Virginia dealers (generally individuals and businesses making sales with one or more physical locations in Virginia) must register for Retail Sales Tax.
- Out-of-state dealers (generally individuals and businesses located outside of Virginia, but with sufficient connection, or nexus, to Virginia) must register for Use Tax. Out-of-state dealers without sufficient nexus, can still choose to register to collect the tax as a courtesy to their Virginia customers.
How to register
You can register for retail sales and use taxes online or by mail.
- New businesses. Register online or by mail using the Business Registration Application (Form R-1).
- Existing businesses. If your business is already registered, log in to your Business Account and add the new tax type to your registration. If you don't have an online services account, enroll now. Or, add the new tax type by mail using Form R-1.
When you complete your registration, you'll receive your 15-digit sales tax account number and your Sales Tax Certificate of Registration (Form ST-4). Be sure to save both.
Sales Tax Certificates (Form ST-4)
Your certificate must be displayed prominently at your registered location.
You can also get a copy by calling Customer Services at 804.367.8037.
When to file
Based on your tax liability, we'll determine your filing frequency - either monthly or quarterly. Returns are due on the 20th of the month following the close of the filing period, even if there are no sales to report. Quarterly filing periods end March 31, June 30, Sept. 30 and Dec. 31.
We may change your filing frequency based on your tax liability. If we change your filing frequency, we'll send you a letter notifying you of the change prior to the effective date.
How to File and Pay
You are required to file and pay your sales tax electronically, unless you have been granted a waiver.
- In-state dealers file their sales tax using Form ST-9.
- Out-of-state dealers file their use tax using Form ST-8.
If you are unable to file and pay electronically, you must submit an electronic filing waiver request. Waivers are temporary and must be renewed annually.
A discount on the amount of sales tax due is allowed when eligible businesses file and pay the tax in a timely manner. Dealers can keep a portion of the tax they have collected; however, the discount is not allowed on the local portion of the tax. In addition to the retail sales and use tax, a dealer's discount is available for the following taxes:
- Vending Machine Tax
- Digital Media Fee
- Tobacco Products Tax
Direct Payment Permit
A Direct Payment Permit allows certain companies to purchase goods without paying the sales or use tax at the time of purchase. These companies agree to pay the tax due directly to Virginia Tax, and allocate the local tax so that no county or city will lose any revenue. Direct Payment Permits are typically issued to manufacturers, contractors, or mine operators that store tangible personal property within the commonwealth for use both in and outside of Virginia.
Businesses who meet the qualifications set forth in Va. Code § 58.1-624 may apply to the Tax Commissioner for a permit. If approved, you will file Form ST-6.
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%. The minimum penalty is $10. The minimum penalty applies to late returns even if there is no tax owed.
Interest is added at the federal underpayment rate plus 2% and accrues on the tax until paid.
Consumer's Use Tax for Businesses
The consumer's use tax applies to tangible items used, consumed or stored 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.
How to File
Returns are due by the 20th day of the month after the close of the reporting period. You do not need to file a return for periods in which no use tax is due.
Businesses must file and pay consumer's use tax electronically.
- If your business is not required to register for retail sales and use taxes, file and pay using the eForm ST-7.
- Otherwise, include the taxable items in your totals on your retail sales or use tax return.
If you are unable to file electronically, you must submit an electronic filing waiver request.
There are specific instances where a tax exemption may apply without the need of an exemption certificate. Some common exemptions and exceptions to the retail sales and use tax are:
In many cases, in order to sell, lease, or rent tangible personal property without charging sales tax, a seller must obtain a certificate of exemption from the buyer. The sales-for-resale exemption prevents tax from being charged multiple times on the same item. The sales tax is intended to be applied to the final retail sale to the consumer. Therefore, the exemption prevents the tax being applied on goods as they are distributed before being sold at retail.
A dealer who makes a sale without charging applicable sales tax must retain a copy of the exemption certificate on file to substantiate the sale was tax exempt under the law.
Virginia Sales and Use Tax Dealer Lookup
If your business is registered as a retail sales tax dealer with us, you can use the Virginia Sales and Use Tax Dealer Lookup through your online business account to verify that a business providing you with a sales tax exemption certificate is currently registered as a retail sales tax dealer in Virginia. If you don’t have an account, you’ll need to create one to use the tool. You can also call Customer Services at 804.367.8037 to check.
Cigarette Resale Exemption Certificates
Cigarette retailers and wholesale dealers must use the Cigarette Resale Certificate of Exemption (ST-10C) issued by Virginia Tax to buy cigarettes tax exempt for resale in Virginia. Form ST-10 is no longer be accepted for these purchases.
To apply for an exemption certificate or to learn more about the process, go to Cigarette Resale Exemption Certificates.