Who must file a Sales tax return?
Every individual or business is required to file a sales tax return if they had a taxable sale or provided a taxable service. The individual or business must also have:
- Nexus (A taxable sale or service was physically provided in the District of Columbia) or;
- Economic Nexus (A remote seller with more than $100,000 of gross receipts from retail sales delivered into the District or more than two hundred separate retail sales delivered in the District).
What are the different filing Frequencies for sales tax?
There are three different filing frequencies:
- Monthly (sales greater than >$1201 per period)
- Quarterly (sales greater than $200 but less than $1200 per period)
- Annual (sales less than $200 per period)
OTR will inform taxpayers of their filing frequency.
Taxpayers cannot set their filing frequency. There is an annual evaluation that OTR conducts to update filing frequencies. If OTR changes your filing frequency, you will receive a notice to inform you of the new filing frequency.
Returns and payments are due by the 20th of the month following the end of the monthly, quarterly, or annual period. For annual filers, this is October 20th.
I received a Notice of Delinquency. When am I required to file a sales tax return?
Please review page 5 of the Notice of Delinquency you received to determine your filing frequency.
What are the sales tax rate(s)?
The District of Columbia sales tax rate can vary depending on the service or item subject to sales tax. For additional information, please see pages 6 and 7 of the Sales Tax Instruction Booklet.
Service or Item
General Sale or Medical Marijuana - Tax Rate: 6%
Soft Drink - Tax Rate: 8%
Food, Drink prepared for immediate consumption or spirituous or malt liquors, beer, and wine sold for consumption on the premises where sold - Tax Rate:10%
Rental Vehicles - Tax Rate:10.25%
Spirituous or malt liquors, beers, and wine sold for consumption off the premises where sold, unless sold by an alcoholic beverage licensee - Tax Rate: 10.25%
Rooms, lodgings, or accommodations - Tax Rate:15.95%
Parking or storing of motor vehicles or trailers - Tax Rate:18%
How do I file a sales tax return?
For tax years 2017 and forward, the returns must be filed electronically as a logged-in function via mytax.dc.gov. Please see the step-by-step instructions in the link below. How to File a Sales and Use Return.
Can I file a paper sales tax return?
Taxpayers can file a paper return for tax year 2016 and prior. However, OTR encourages all returns to be filed electronically.
Reminder: Paper returns are not accepted for tax years 2017 and forward.
I am exempt from sales tax. How do I resolve the Notice of Delinquency?
Please review your records to verify that your exemption did not expire. If the exemption is still active, please email [email protected] or call the Collection Call Center at (202) 724-5045.
If your exemption expires, please complete FR-164 to renew your exemption: How to Request an Exemption to File.
Please allow 7-10 business days for the exemption request to be reviewed.
If the exemption renewal is approved, please email [email protected] or call the Collection Call Center at (202) 724-5045.
I had zero activity for the period listed on the notice. How do I resolve the Notice of Delinquency?
You must file a return even if you had zero activity during the filing period.
My business closed. How do I notify the Office of Tax and Revenue?
If your business is closed, you must file a final return for the period of last activity in the District of Columbia.
I never had a business. How do I close out the sales tax account?
Please email [email protected] or call the Collection Call Center at (202) 724-5045 and request that the account be closed.
Alternatively, you may file a final return for the quarter in which the account was created to close the account.
Can I file a sales tax return for multiple locations under one Federal Employer Identification Number (FEIN)?
While all of a businesses sales tax returns can be filed using the same FEIN, each business location must have its own sales tax account. The sales tax collected by each location must then be reported and paid to the sales tax account associated with the location. For more information relating to registering multiple sale tax locations, please contact the Customer Service Administration at (202) 727-4829.
I filed a sales tax return using the wrong frequency. How do I resolve the Notice of Delinquency?
The taxpayer may need to amend the return and file returns under the correct account.
Taxpayers may also have to submit a request in writing to have the payments reallocated to the correct account or period. Please email any written request to [email protected].
If I file a sales tax return late, am I subject to penalties and interest?
Yes, if a return is filed late with a tax amount due, you will be subject to a late filing penalty of 5% minimum to 25% maximum. Interest will accrue at 10% per year, compounded daily.