Ultimate Tennessee Sales Tax Guide
| State taxing authority: | Tennessee Department of Revenue |
| 2023 Tennessee state sales tax rate: | 7% |
| Local sales tax rates? | Yes |
| Streamlined Sales and Use Tax Agreement Member? | Yes (Associate Member State) |
Do I have to collect Tennessee sales tax from customers?
Retailers who meet these two requirements are required to collect sales tax in Tennessee:
- Has sales tax nexus in Tennessee
- Sells taxable products or services in Tennessee
What creates sales tax nexus in Tennessee?
- Physical presence - A location or inventory, personnel, and other in-state business activities OR
- Economic nexus - Sales to buyers in Tennessee exceeded $100,000 in the previous 12-month period
Learn more about sales tax nexus and when that means you’re required to collect sales tax here.
Do I have to collect sales tax from Tennessee customers if I sell on Amazon, Walmart, eBay or Etsy?
No. Tennessee has a marketplace facilitator law, which means that marketplaces like Amazon or eBay are required to collect sales tax on behalf of 3rd party sellers on their platform.
If you have sales tax nexus in Tennessee, keep in mind that you are still required to collect sales tax on your other, non-marketplace, Tennessee sales.
Further, Tennessee specifies that in-state sellers are still required to register for a sales tax permit even if you only make sales through marketplaces.
Read more about marketplace facilitator sales tax laws here.
Are my products taxable in Tennessee?
Most tangible personal property is subject to sales tax. However, some necessities like food, clothing and medication are not taxable in some states. And sometimes states consider things like digital goods (eBooks, music, movies) and software-as-a-service (SaaS) taxable even though they can’t be touched or held.
Here’s how Tennessee taxes the most commonly sales tax exempt items:
Are groceries taxable in Tennessee?
Yes, groceries are taxable in Tennessee, but at a reduced state rate of 4%. Further, local areas might impose an additional sales tax on groceries.
Is clothing taxable in Tennessee?
Yes, clothing is taxable in Tennessee.
Are digital products taxable in Tennessee?
Yes, digital products are taxable in Tennessee. However, rather than being taxed at a combined state + local rate, digital goods are taxed at the state’s 7% sales tax rate plus a standardized 2.5% local rate.
Is software-as-a-service (SaaS) taxable in Tennessee?
Yes, SaaS is taxable in Tennessee.
Are services taxable in Tennessee?
Services are non-taxable unless specifically enumerated by law or sold as part of a taxable sale of a tangible product. Taxable services include:
- Cleaning of tangible personal property
- Enriching of uranium materials
- Lodging services
- Parking and storing motor vehicles
- Repair or installation (including mending, altering, refinishing, etc.) of tangible personal property
- Short-term space rental
- Telecommunications
Read more about taxable services in Tennessee here.
How to Register for a Tennessee Sales Tax Permit
Register for a Tennessee seller’s permit at TNTAP.
Go here to learn how to register for a sales tax permit in every US state.
Do I need a Tennessee sales tax permit if I only sell temporarily in the state?
Yes, all sellers making sales in the state, even temporarily such as at a craft fair or flea market, must register and collect Tennessee sales tax.
How to Collect Sales Tax in Tennessee
I’m in Tennessee. How do I collect sales tax from my Tennessee buyers?
Tennessee is one of a handful of states with origin-based sales tax sourcing for in-state sales. This means that sales tax is charged at the rate of the location where the order originates. (That simply means the rate from where the item is sold/shipped.)
So if your online store’s headquarters is located in Tazewell, Tennessee and you make a sale to a buyer in Knoxville, Tennessee then you’d charge the sales tax rate at the location where the order originated. In this case, that is your HQ in Tazewell.
To sum it up, if a sale is sourced from a location in Tennessee, then you’d charge the sales tax rate at the location where the order originated.
I’m not in Tennessee but have sales tax nexus there. How do I collect sales tax from Tennessee buyers?
For interstate sales, Tennessee is a destination-based sales tax sourcing state. So if you are located in South Dakota but make a sale to a buyer in Tennessee, then you would charge the sales tax rate at your buyer’s location in Tennessee.
This is with the exception of digital products, which are subject to the 7% Tennessee state rate plus a 2.5% local rate across the board.
Should you collect sales tax on shipping charges in Tennessee?
Yes. Shipping charges are subject to sales tax in Tennessee.
Learn about sales tax on shipping in every US state here.
How to File and Pay Sales Tax in Tennessee
When your sales tax filing due date approaches, you can file Tennessee sales tax returns in multiple ways.
- File and pay online - At the TN TaxPayer Access Point (TNTAP).
- File and pay by mail - File out Form SLS-450 State and Local Sales Tax Return and mail it in.
- Let Zamp handle your Tennessee sales tax filing and remittance so you never have to look at a sales tax return again!
Learn how to file and pay sales tax in other US states here.
I didn’t collect any Tennessee sales tax this period. Do I still need to file a return?
Yes. You should still file a “zero” return with the state even if you didn’t collect any sales tax over the taxable period.
What is the penalty for filing and/or paying Tennessee sales tax late?
The penalty for both failing to file and pay Tennessee sales tax is the great of 5% of tax due per 30 days or fraction (maximum 25%) or $15.
Can I amend a Tennessee sales tax return?
Yes, you can amend a previously filed return in TNTAP by logging in and following these steps:
- Click View/FIle returns next to the account
- Click the “View or Amend Return” link
- Click the “Amend link”
How often will I be required to file and pay sales tax in Tennessee?
Tennessee assigns taxpayers sales tax filing frequencies of either monthly, quarterly or annually. The more sales you make into Tennessee and the more sales tax you collect, the more often you’ll be required to pay.
Tennessee sales tax due dates
Tennessee Monthly Sales Tax Filing Due Dates
| Taxable Period | Filing Due Date |
| January 2023 | February 21, 2023 |
| February 2023 | March 20, 2023 |
| March 2023 | April 20, 2023 |
| April 2023 | May 22, 2023 |
| May 2023 | June 20,2023 |
| June 2023 | July 20, 2023 |
| July 2023 | August 21, 2023 |
| August 2023 | September 20, 2023 |
| September 2023 | October 20, 2023 |
| October 2023 | November 20, 2023 |
| November 2023 | December 20, 2023 |
| December 2023 | January 22, 2024 |
Tennessee Quarterly Sales Tax Filing Due Dates
| Taxable Period | Filing Due Date |
| Q1 (Jan-March) 2023 | April 20, 2023 |
| Q2 (Apr-June) 2023 | July 20, 2023 |
| Q3 (July-Sept) 2023 | October 20, 2023 |
| Q4 (Oct-Dec) 2023 | January 20, 2024 |
Tennessee Annual Sales Tax Filing Due Date
| Taxable Period | Filing Due Date |
| Year 2023 | January 22, 2024 |
- Do I have to collect Tennessee sales tax from customers?
- Are my products taxable in Tennessee?
- How to Register for a Tennessee Sales Tax Permit
- How to Collect Sales Tax in Tennessee
- How to File and Pay Sales Tax in Tennessee
