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Washington DCSales Tax

A Complete Guide For Businesses

State Rate
5.75%

Local Tax
no

Phone
(202) 727-4829

General requirements

Washington D.C. is a destination-based state (sales are taxed where the buyer is located).

  • Sales tax is charged on the sale of tangible personal property (TPP) with a few exceptions
  • Services offered in the state are generally not taxable

Businesses may file online at the MyTax.DC portal.

Rates

The state’s base sales tax rate is 5.75%. There is no additional local sales tax.

How food is taxed

Grocery-type food items are generally tax exempt, while prepared foods are taxed at a rate of 10%. Liquor sold for consumption on and off the premises is also taxed at a rate of 10%.

Nexus in Washington D.C.

Business activites that establish a minimum tax connection to the state include:

  • Having a representative for the purpose of making sales, or taking orders for sales
  • Maintaining an office, place of distribution, sales place, warehouse place, or other place of business

Find out more about nexus in Washington DC.

Filing schedule

Due dates are as follows:

  • Annual filers: Returns are due on October 20th or the next following business day
  • Quarterly filers: Returns are due on or before the 20th month following the quarterly tax period
  • Monthly filers: Returns are due on or before the 20th of the month for the previous month's tax period

Registering to collect sales tax in Washington D.C.

New businesses must register at MyTax.DC. Check out the New Business Registration section on their website for more information.

Penalties

Penalties are charged on late returns and payments as follows:

  • Late Filing Penalty: 5% penalty applied per month if you do not file your tax return by its due date (up to a maximum of 25%)
  • Late Payment Penalty: 5% penalty applied per month if your tax payment is late (up to a maximum of 25%)

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