Steps to Starting Your Own Business
Starting a Business:
FirstStop Business Connection
The 1st Stop Business Connection, a program sponsored by the
Ohio Department of Development's Small Business Development
Centers and the U.S. Small Business Administrations, provides
free state-level information needed to get started or
continue your entrepreneurial journey.
What is sales
Sales tax is a "trust" tax that is to be collected by all
retailers and certain service providers when they make
taxable retail sales. It is called a "trust" tax because the
consumer has entrusted this tax to retailers and certain
service providers with the understanding that it will be
reported and paid to the State of Ohio in a timely manner.
What must I do to make taxable sales
Every Ohio retailer (vendor) and certain service providers
making taxable retail sales must obtain a vendor's license,
collect the proper amount of sales tax, file tax returns with
payment of tax collected, and maintain complete records of
of license do I need?
Type of License
For vendor’s with a fixed place of business. Vendors must have a separate license for each business location.
For vendors who make sales in any county in which they have no fixed place of business. This license can be used statewide.
For vendors outside of Ohio making sales for use, storage, or consumption in Ohio.
For purchasers who have not paid the tax to a vendor or seller. In most cases this if for out-of-state transactions.
How and When is Sales Tax
Vendors must charge and collect the sales tax at the rate in
effect in the county where the sale is made or obtain valid
documentation detailing why the sale is exempt from tax.
Tax on titled motor vehicles, off-highway motorcycles,
all-purpose vehicles, personal watercraft, titled watercraft
and titled outboard motors is paid to the county Clerk of
Courts at the rate in effect in the purchaser's county of
residence. Telecommunication services are taxed at the rate
in effect in the county of the billable telephone number.
Most other areas listed under services are taxed at the
county rate where the service is received.
The tax applies when the sale is made, not at some future
date when payment is received. For example, if a vendor makes
a sale on credit in January, but the money is not received
until February, the tax must be reported and paid with
Vendors must charge the tax on every sale unless the customer
provides a properly completed exemption certificate or the
sale is exempt by law. Tax must be paid to the state on every
taxable sale, even if the price is not collected from the
customer. Vendors who fail to send in collected taxes, make
sales without a license, or make sales with a suspended or
revoked license, are subject to assessments, fines, and
What is the Tax
Tax must be charged on the total price billed to the
customer. This includes delivery charges, charges for set-up,
assembly, installation, preparation, engraving, and all other
costs that make up the total amount charged.
When do I File a Tax
Vendors will receive a letter from the Department of Taxation
concerning their filing schedule (monthly, semiannually, or
EFT) shortly after obtaining a vendor's license. Returns must
be filed when due even if no sales are made and/or no tax is
due. Filing schedules are set according to the vendor's
anticipated tax liability or their business activity.
The tax return must be filed and received by
the Department of Taxation on or before the due date
indicated on the return. Monthly returns are due on the 23rd
of the month, following the reporting period of the prior
month; semi-annual returns are due on Jan. 23 and July 23 for
the previous six-month filing periods.
How do I File a Sales Tax
All vendors, regardless of sales volume, are now required to
file electronically rather than on paper. Consumers Use
taxpayers have the option to file electronically. For
business owners, electronic filing cuts down on paperwork and
postage costs. For state government, each electronic return
saves a dollar or two in processing costs, and if you think
about it, the taxpayer dollars saved are really yours.
The Ohio Department of Taxation offers multiple ways to file
sales or use tax returns electronically. You have three
electronic options for filing: The Ohio Business Gateway,
Sales & Use Tax eForms and Telefile. The following table
offers a point-by-point comparison of each method so business
owners can decide which one suits them best.
Filing Methods (Add link from email number 6 starting a