Vermont Sales Tax Rates

How to register for sales tax in Vermont

Vermont offers two main ways to register for sales tax:

• Online: This is the preferred method and strongly encouraged by the Vermont Department of Taxes. You can register through their online portal, myVTax: http://tax.vermont.gov/
• Mail/Fax: You can also register by mail using form BR-400, downloadable from the Department of Taxes website. Faxing the form is another option, but less common.

How to collect sales tax in Vermont

1. Calculate the Sales Tax
2. Rounding Rules:

• Vermont uses a specific rounding rule for sales tax calculations.
• You must carry out the tax calculation to the third decimal place.
• Then, round the tax amount to the nearest whole cent:
  • If the third decimal place is greater than four, round up to the next cent.
  • If the third decimal place is four or less, round down to the nearest cent.

3. Collection Methods:

• You can collect sales tax by including it in the total price displayed to your customer.
• Most point-of-sale (POS) systems can automatically calculate and add the sales tax during checkout.

4. Record Keeping:

• It’s crucial to keep good records of your sales and the sales tax you collect.
• These records will be necessary when you file your sales tax returns.

How to get a sales tax permit/license in Vermont?

There are two main ways to register for a sales tax permit in Vermont:

1. Online: This is the preferred method and highly encouraged by the Vermont Department of Taxes. You can register through their online portal, myVTax: http://tax.vermont.gov/
2. Mail/Fax: You can also register by mail using form BR-400, downloadable from the Department of Taxes website. Faxing the form is another option, but less common.

When are Vermont’s sales tax returns due?

The due date for Vermont’s sales tax returns depends on the filing frequency assigned to you by the Department of Taxes when you register for your sales tax permit. Here’s a breakdown:

• Filing Frequency: The department determines your filing frequency based on your estimated annual sales tax liability.
• Possible Frequencies: They typically assign either monthly, quarterly, or annually.
• Due Dates:
  • Monthly Filers: You must pay sales tax for the month by the 25th day of the following month. (Exception: February is due on the 23rd)
  • Quarterly Filers: Due dates are the 25th day of April, July, October, and January, following the respective quarter ends (March 31, June 30, September 30, and December 31).
  • Annual Filers: The due date is typically the 25th day of April for the prior year’s sales tax.

Is anyone exempt from sales tax in Vermont?

Exempt Items:

• Common Examples:
  • Groceries (excluding prepared food and soft drinks)
  • Prescription drugs and medical equipment
  • Clothing for children under 12 (with some exceptions)
  • Over-the-counter medications
  • Feminine hygiene products

Exempt Customers:

• Common Examples:
  • Federal government
  • State of Vermont
  • Non-profit organizations qualifying for federal exempt status under 26 U.S.C. § 501(c)(3)
  • Agricultural organizations qualifying under 26 U.S.C. § 501(c)(5) (for certain purchases)
  • Merchants purchasing goods for resale (requires a resale certificate)