Connecticut sales tax guide Connecticut sales tax guide

Connecticut

Standard rate: 

6.35 – 9.35%

Reduced rate:

1 – 2.99%

Sales tax-free products and services:

Who is obliged to register sales tax:

When you sell in Connecticut and have “sufficient activity” in Connecticut, you need to be registered to collect and pay sales tax in Connecticut. Connecticut requires that any merchant with a sales tax permit file a sales tax return on your due date, even if you don’t have any sales tax to report or pay.

Threshold:

Starting December 1, 2018 out-of-state dealers with sufficient physical or economic presence for establishing nexus in Connecticut must register to collect sales tax. This includes both online and remote sellers that have the $250,000 in annual Alabama gross sales, and have 200 or more sales.

Merchant thresholds by state

Marketplace thresholds by state

The special rules are applicable for the SAAS business.

Software as Service Tax Thresholds by state

Online Marketplaces:

If all your sales in Connecticut come from a marketplace reseller platform, in this case you can’t register for paying sales tax in Virginia. Your marketplace promoter pays the sales tax itself.

If you sell through your own website, then you need to be registered for paying sales tax if you have 200 or more retail sales in Connecticut and have at least $250,000 in gross.

If you do not meet the threshold, you are not obliged to register.

A marketplace facilitator is considered the retailer of each sale that he has simplified to his seller. Therefore, each marketplace facilitator must:

  1. Collect and remit sales tax on each sale delivered in Connecticut;
  2. Be responsible for all obligations and duties imposed by Connecticut sales and use tax laws, as if the marketplace facilitator was the retailer of such sale, including timely filing all returns; and
  3. Keep records and information to ensure proper collection and remittance of the tax, including any exemption certificates, resale certificates, or other relevant documentation.

In accordance with the law, to ensure that marketplace sellers are not responsible for collecting and remitting sales tax on the same sales occurring through the marketplace facilitator’s forum, the marketplace facilitator should either enter into an agreement with its marketplace sellers that explicitly provides that the marketplace facilitator will collect and remit sales tax on all taxable sales, or provide its marketplace sellers with a properly completed Certificate confirming that the facilitator is registered to collect sales tax.

Registration procedure:

You can be registered online on the Connecticut Department of Revenue.

Sales tax payment and filing date: 

Depending on your tax liability, determine your filing frequency – either monthly, quarterly or Annual:

Annual – $0 to $83.33
Quarterly – $83.34 to $333.33
Monthly – $333.34 and up

Returns are always due the 20th day of the month following the reporting period.  If the filing due date falls on a weekend or holiday, sales tax is due the next day. Quarterly filing periods end on the last days of March, June, September, and December.

  • Late Filing Penalty $50, plus 1% per month of the tax imposed.
  • Late Payment Penalty 1% of the unpaid tax bill for each month (or fraction of a month) of delinquency.