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TennesseeSales Tax

A Complete Guide For Businesses

Automate My TennesseeSales Tax Filings

State Rate
7.00%

Local Tax
yes

State Portal
Department of Revenue

Phone
(800) 342-1003

General requirements

Tennessee is an origin-based state (sales are taxed where the seller is located).

  • Sales tax is charged on retail sales, leases, or rentals in Tennessee of any goods, computer software, warranty contracts, or certain services and amusements
  • For manufacturers, purchases used for production aren’t taxed
  • For distributors, items purchased for resale aren’t taxed

File your tax return online at the Tennessee Taxpayer Access Point.

Rates

The state sales tax rate for most tangible personal property and taxable services is 7%.

Tennessee has a State Single Article Rates of 2.75% on any single item sold in excess of $1,600 but not more than $3,200.

Additional local rates range from 1.5% to 2.75%. See local tax chart.

For a fast and accurate sales tax rate lookup by zip code, use our up-to-date calculator below.

Look up your Tennessee sales tax rate:

How food is taxed

The reduced sales tax rate on food and food ingredients is 4% plus applicable local taxes. Prepared foods are taxed at the general state and local rate.

Nexus in Tennessee

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

  • Maintaining a physical place of business including a warehouse or distribution center
  • Having employees, independent contractors, or representatives working in the state
  • Leasing property in the state
  • Performing jobs as a construction contractor
  • Participating in promotional activities in the state such as trade shows
  • Delivering sales in a company owned vehicle

Online activities that establish nexus in Tennessee include:

  • Having an affiliate or referral relationship with a contractor or representative in the state
  • Sales from these referrals exceed $10,000 over the past 12 months

Economic nexus in Tennessee:

  • According to state law, out-of-state sellers whose sales into Tennessee exceed $500,000 in the previous 12 months must register with the state, collect sales tax on sales to Tennessee, and remit that sales tax to the state.
  • Effective date: July 1, 2017

Want more information? Check out these FAQs.

Filing schedule

Due dates for monthly, quarterly, or annual filing frequencies are on the 20th of the month following the end of the filing period.

Registering to collect sales tax in Tenessee

You may register a new business for the collection of sales tax at Tennessee Taxpayer Access Point.

Penalties

A penalty is imposed for late filing or late payment at a rate of 5% per month. The maximum penalty is 25% of the tax amount due; the minimum penalty is $15.

Interest accrues on late payments.

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