Total Range for 2025
| Base state sales tax rate | 4.30% | Base state sales tax rate | Base state sales tax rate | Base state sales tax rate | Base state sales tax rate |
| Local rate range | 0%-2.7% | Base state sales tax rate | Base state sales tax rate | Base state sales tax rate | Base state sales tax rate |
| Total rate range | 4.3%-7% | 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 Virginia is 4.3%, but since the local rates range from 0-2.7% the total sales tax range is 4.3-7%.
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:
You are a small business based in Richmond, Virginia selling handcrafted wooden toys. A customer purchases a toy for $25.00.
- Richmond has a combined sales tax rate of 6% (4.3% state + 1.7% local).
- Sales tax: $10 x 5.3% = $1.325
- Total price: $10 + $1.325 = $11.325
Nexus: Why do you need to collect sales tax in Virginia?
If you’re selling goods and services in Virginia then sales tax might apply! To determine your obligation, you need to understand “nexus,” which ties businesses to states for tax purposes.
Two types of nexus exist:
- Physical Nexus: Having a physical presence, like an office, warehouse, or employees in Virginia, triggers this type. If you do, you likely need to collect sales tax.
- Economic Nexus: This kicks in when your sales within Virginia exceed a certain economic threshold. Even without a physical presence, surpassing this threshold requires collecting sales tax.
In Virginia, there is also a transaction threshold of 200, which means that even if your sales aren’t over $100,000 if you’ve sold more than 200 items then you still need to pay sales tax.
Services
- Virginia doesn’t tax most pure service transactions, which means there’s no sales tax on labor or services performed
- If your service directly results in the creation of a taxable good, there might be sales tax involved. For example, if you install flooring, the flooring itself would be taxable.
Goods
- In Virginia, sales of most tangible personal property are subject to sales and use tax.
- There are exemptions for certain items like groceries certain medical devices and educational textbooks sold by institutions
Freight/Shipping
- The cost of shipping and freight is usually considered part of the sale and is taxable along with the good being shipped.
Clothing
- In Virginia, clothing is taxable. But some protective clothing/gear may be tax exempt.
Electronics
- Yes, electronics are taxable in Virginia as they are included as tangible goods.
SaaS
- In Virginia, SaaS are not taxed as they fall under services.
Digital Products
- In Virginia, digital products that are delivered electronically are not taxed
Software
- Sales of canned or pre-written software are considered tangible personal property and are subject to sales tax in Virginia.
- There are some exceptions, like custom software development, which may be considered a service.
How to register for sales tax in Virginia
To register for sales tax in Virginia, you have two options: online or by mail. Here’s a breakdown of both methods:
Online Registration:
- Business Online Services Account: This is the recommended method. If you haven’t already, you’ll need to create a Business Online Services Account with Virginia Tax https://www.tax.virginia.gov/businesses.
- Adding Sales Tax: Once logged in, navigate to your account and select “File/ Pay Taxes.” There, you can choose to add “Sales and Use Tax” as a new tax type.
Mail-in Registration:
- Form R-1: You’ll need to complete the Business Registration Form (Form R-1) https://www.tax.virginia.gov/register-business-virginia.
- Existing Registration: If you’re already registered with Virginia Tax for another purpose, update your existing registration using the “Retail Sales and Use Tax” section on Form R-1.
- Mailing the Form: Send the completed Form R-1 to the address provided on the form.
How to collect sales tax in Virginia
- Collect the Tax: At the point of sale, add the appropriate sales tax to the total on your customer’s receipt. Most Point-of-Sale (POS) systems can automate this calculation.
- Maintain Records: Keep good records of your sales and sales tax collected. This includes invoices, receipts, and sales reports.
How to get a sales tax permit/license in Virginia?
To get your sales tax “permit” (really a Sales Tax Certificate) in Virginia:
- Online: Create a Virginia Tax Business Online Services Account and register for “Sales and Use Tax.”
- Mail-in: Fill out and mail Form R-1, adding “Retail Sales and Use Tax” if already registered for something else.
After registering, you’ll receive a Sales Tax Certificate to display at your business. Remember, electronic filing is required!
When are Virginia’s sales tax returns due?
Virginia sales tax returns are due on the 20th day of the month following the reporting period. This applies to both monthly and quarterly filers. Here’s a breakdown:
- Monthly filers: If your sales tax liability is high enough to require monthly filing, your returns are due on the 20th of each month following the sales month.
- Quarterly filers: If you qualify for quarterly filing, your return deadlines are:
- April 20th (for sales in January, February, March)
- July 20th (for sales in April, May, June)
- October 20th (for sales in July, August, September)
- January 20th (for sales in October, November, December)
Is anyone exempt from sales tax in Virginia?
Exempt Customers:
- Government Agencies: Federal, state, and local government agencies are generally exempt from paying sales tax on purchases made for official government business.
- Certain Non-Profit Organizations: Qualifying non-profit organizations may be exempt from sales tax on purchases used for exempt purposes.
Exempt Purchases:
- Groceries: Most groceries are taxed at a reduced rate of 2.5% in Virginia.
- Prescription Drugs and Medical Equipment: Prescription drugs and certain medical equipment are exempt from sales tax.
- Educational Textbooks: Textbooks purchased by students for use in educational institutions are exempt.
- Occasional Sales: Occasional sales by non-profit organizations, limited to under 23 events per year, are exempt for food and meals.
Do I Have to Collect Sales Tax from Virginia Customers if I Sell on Amazon, Walmart, Ebay, or Etsy?
No.
Virginia has a marketplace facilitator law, which means that marketplaces like Walmart or Amazon should collect sales tax on behalf of 3rd party sellers on their platforms.
However, if you have a sales tax nexus in Virginia, you are still required to collect sales tax on your other non-marketplace Virginia sales.
