Alabama is a destination-based state (sales are taxed where the buyer is located).
File your Alabama sales tax return online at My Alabama Taxes.
The state sales and use tax rate for Alabama is 4%. In addition to the state sales tax, local sales taxes are also due, and these rates vary. Search local rates by city or county.
Food items, food ingredients, and prepared foods are all taxed at the general state and local rates. Food sold in vending machines is taxed at a reduced rate of 3%.
Business activities that establish a minimum tax connection to the state include:
Returns are due on or before the 20th day of the month for the previous month’s sales. If your total tax liability is less than $200 per month during the preceding calendar year, you can elect to file and pay quarterly by appealing in writing to the Department no later than February 20th of each year.
When you file and pay on time, you’ll receive a discount of 5% on the first $100 of tax due, and 2% of all tax due over $100. This discount cannot exceed $400 per month.
Businesses may obtain a new tax account number online at My Alabama Taxes.
You should receive your account number within two to three days by email. A license will be mailed to you later.
Penalties are charged as follows:
Interest is charged at the current rate.