Total Range for 2025
| Base state sales tax rate | 4.50% | Base state sales tax rate | Base state sales tax rate | Base state sales tax rate | Base state sales tax rate |
| Local rate range | 0%-7% | Base state sales tax rate | Base state sales tax rate | Base state sales tax rate | Base state sales tax rate |
| Total rate range | 4.5%-11.5% | Base state sales tax rate | Base state sales tax rate | Base state sales tax rate | Base state sales tax rate |
| Economic sales nexus threshold | Base state sales tax rate | Base state sales tax rate | Base state sales tax rate | Base state sales tax rate | |
| Transactions threshold | N/A | Base state sales tax rate | Base state sales tax rate | Base state sales tax rate | Base state sales tax rate |
| Sales tax return filing due date | 20th of following month | Base state sales tax rate | Base state sales tax rate | Base state sales tax rate | Base state sales tax rate |
The base state sales tax rate in Oklahoma is 4.5%, but since the local rates range from 0-7% the total sales tax range is 4.5-11.5%.
How to calculate your sales tax rate
Use our online sales tax calculator to determine the combined state and local sales tax rate for each location where you have a physical or economic nexus. Just enter your state and ZIP code to get your sales tax rate.
Example of using the sales tax rate in a tax calculation:
If you sell a product for $100 in a location with a combined sales tax rate of 8.5% (4.5% base rate + 4% local rate), the sales tax amount would be $8.50 (100 x 8.5%). You would collect $108.50 ($100 + $8.50) from the customer.
Nexus: Why may you need to collect sales tax in Oklahoma?
Similar to other states, Oklahoma has two main ways to establish nexus, which triggers the obligation for a business to collect and remit sales tax: physical nexus and economic nexus.
Physical Nexus:
A business has physical nexus in Oklahoma if it has a physical presence in the state. This includes, but is not limited to:
- Maintaining an office, warehouse, or store in Oklahoma
- Having employees, representatives, or agents soliciting sales in Oklahoma on your behalf
- Owning or leasing tangible personal property in Oklahoma (with some exceptions)
Economic Nexus: Even without a physical presence, a business can still have nexus in Oklahoma if it meets the state’s economic nexus thresholds. Oklahoma follows a destination-based sourcing rule, meaning sales tax is applied based on the customer’s location, not the seller’s location.
Effective November 1, 2019, Oklahoma considers a seller to have economic nexus if they have at least $100,000 in aggregate sales of tangible personal property delivered to locations within the state during the current or preceding calendar year.
Important Notes:
- Gross receipts used to determine economic nexus include both taxable and non-taxable sales.
- If a business meets the economic nexus thresholds, it must register for a sales tax permit and start collecting sales tax from Oklahoma customers on the very next sale.
Understanding your nexus in Oklahoma is crucial to determine your sales tax collection obligations. If you’re unsure whether your business has nexus in Oklahoma, it’s always best to consult with a tax professional like Yonda Tax for guidance.
Services
- While most standalone services aren’t subject to taxation in Oklahoma, there are exceptions. If a service directly relates to the sale of tangible personal property and the service charge is included in the sales price, the entire transaction may be taxable.
Goods
- The majority of tangible personal property sold in Oklahoma is taxable, covering common items like furniture, sporting goods, etc.
However, specific exemptions exist, such as: certain unprepared food items (but not restaurant meals), prescription drugs and medical devices and certain farm machinery and equipment.
Freight/Shipping
- If shipping and transportation charges are itemized separately on the invoice and not included in the product’s sales price, they are generally exempt from taxation in Oklahoma.
- Conversely, if shipping and transportation charges are integrated into the product’s sales price and not itemized separately, they are considered taxable alongside the product itself.
Clothing
- In Oklahoma, most clothing is subject to sales tax. This includes items such as shirts, pants, dresses, and shoes.
Electronics
- Electronics are subject to sales tax.
SaaS
- SaaS and cloud products are not taxable
Digital Products
- Digital products are no taxable
Software
- Computer hardware and prewritten software are subject to sales and use tax in Oklahoma, but custom software is exempt.
How to Register for Sales Tax in Oklahoma
If you’ve determined you need to collect sales tax in Oklahoma, registering for a Sales Tax Permit is the next step. Here’s how you can do it:
- Online Registration:
The Oklahoma Tax Commission (OTC) offers online registration through their Oklahoma Taxpayer Access Center (OTAC) system. This is generally the fastest and most convenient method. Here’s what you’ll need:
- Business Information: Business name, address and contact information (phone number and email)
- Federal Employer Identification Number (EIN)
- Business activity start date
- Projected monthly sales and taxable sales
- Products or services offered
- Mail-in Registration:
If online registration isn’t an option, you can also register by mail using an application form (Sales and Use Tax Application – Form OSS).
- Download the Oklahoma Sales and Use Tax Application (Form OSS) from the Tax Commission website.
- Complete the form following the instructions provided. The form will ask for the same information required for online registration.
- Mail the completed application form along with any required documentation (such as a copy of your EIN paperwork) to the address listed on the form.
Whichever method you choose, make sure to have all the necessary information readily available to ensure a smooth registration process.
Additional Notes:
- You may be required to file a surety bond along with your application, depending on your business type and projected sales tax liability. The OTC website has information on surety bond requirements ([invalid URL removed]).
- Once your application is approved, you’ll receive a Sales Tax Permit with your permit number. You’ll need this number to collect and report sales tax.
For more detailed information and specific instructions, visit the Oklahoma Tax Commission website or contact them directly.
How to Collect Sales Tax in Oklahoma
Once you’ve registered for a Sales Tax Permit and received your permit number in Oklahoma, here’s what you need to know about collecting sales tax:
- Determine the Tax Rate:
The sales tax rate in Oklahoma is a combination of a statewide base rate and potential additional local rates. The base rate is currently 4.5%. However, many cities and counties in Oklahoma impose additional local sales taxes on top of the base rate.
You can find the specific sales tax rate for the location where your business is located or where you’re delivering goods/services by using the Oklahoma Tax Commission’s Sales and Use Tax Rate Lookup tool.
- Apply the Tax Rate:
Once you know the applicable tax rate (statewide base rate + any local rates), simply add it to the taxable sales price of your goods or services to determine the amount of sales tax to collect from the customer.
- Keep Good Records:
It’s crucial to maintain accurate records of your sales and sales tax collected. These records are essential for filing sales tax returns and during any potential audits by the Oklahoma Tax Commission. Your records should include:
- Sales receipts
- Tax rates applied
- Amount of sales tax collected for each transaction
- Details of exempt sales
- Report and Remit Sales Tax:
Oklahoma businesses are required to file sales tax returns and remit the collected tax on a regular basis. The specific filing frequency depends on your business’s total sales tax liability.
- Generally, businesses with lower sales tax liability will file quarterly, while those with higher liability may need to file monthly.
- You can find detailed information on sales tax filing deadlines and remittance procedures on the Oklahoma Tax Commission website ([invalid URL removed]) or by contacting them directly.
Additional Tips:
- Consider using sales tax software: Sales tax software can automate calculations, filing, and remittance, saving you time and ensuring accuracy.
- Stay informed: Sales tax laws and regulations can change, so stay updated on any changes that might affect your business, particularly regarding local tax rates.
- Clearly display the sales tax: It’s a good practice to clearly display the sales tax amount on receipts or invoices to avoid confusion for your customers.
How to get a sales tax permit/license in Oklahoma?
To obtain a sales tax permit in Oklahoma, visit the Oklahoma Tax Commission’s website and use the OKTax online system to apply. You’ll need to provide information such as your business name, Federal Employer Identification Number (FEIN) or Social Security Number (SSN), business type, and details about the business and its owners.
After completing the online application, you will receive your sales tax permit. Make sure to collect sales tax on taxable transactions and file returns according to your assigned reporting frequency.
When are Oklahoma’s sales tax returns due?
In Oklahoma, sales tax returns are due based on your assigned reporting frequency:
- Monthly: Returns are due on the 15th day of the month following the end of the reporting period. For example, the return for July is due by August 15th.
- Quarterly: Returns are due on the 15th day of the month following the end of the quarter. For example, the return for the first quarter (January-March) is due by April 15th.
- Annually: Returns are due on the 15th day of the month following the end of the calendar year. For example, the return for the year 2023 is due by January 15, 2024.
If the due date falls on a weekend or holiday, the return is due the next business day. You can find a detailed breakdown of filing deadlines based on your filing frequency and registration month on the Tax Commission website.
Is anyone exempt from sales tax in Oklahoma?
Yes, Oklahoma provides several exemptions from sales tax. Key exemptions include:
- Government Purchases:
- Sales to federal and state government agencies are generally exempt.
- Certain Goods and Services:
- Most food items intended for home consumption are exempt, though there are exceptions for prepared foods and certain beverages.
- SaaS, Cloud and Digital products aren’t taxable
- Prescription medications and specific medical devices are exempt.
- Items used directly in farming, such as feed, seed, and fertilizers, are exempt.
- Nonprofit Organizations:
- Purchases made by qualifying nonprofit organizations may be exempt, but the organization must provide proof of its exempt status.
- Resale:
- Purchases intended for resale in the regular course of business are exempt, provided you have a valid resale certificate.
