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Stay informed and compliant with our Missouri Sales Tax Guide, offering expert insights into compliance, rates, and business regulations
Sales tax at a glance
Missouri sales tax rates & calculations in 2023
The Missouri sales tax rate in 2023 is between 4.225% and 10.1%, comprising a base rate of 4.225% plus local rates up to 5.875%, depending on the jurisdiction. Some areas have no additional local taxes beyond the state rate.
List of local sales tax rates in Missouri
You can look up the full table of sales tax rates in each city and county in Missouri on the Department of Revenue's website [link]. Here are a few examples:
FAQs
How do you calculate Missouri sales tax?
To calculate Missouri sales tax, use the formula:
Tax = (State tax rate + local tax rate) x taxable purchase price
For example, for a $100 taxable purchase in Kansas City with a state rate of 4.225% plus the local rate of 4.625%, the sales tax would be $8.85.
What are the penalties for not paying Missouri sales tax?
Penalties include a late filing penalty of 5% per month (max 25%) plus interest charges. Failure to file may also result in additional penalties.
What's the difference between destination-based and origin-based sales tax states?
Missouri is an origin-based sales tax state, meaning sellers collect tax based on the rate where the sale originated rather than where the customer is located. In destination-based states, tax is based on the buyer's location instead.
Is Missouri a streamlined sales tax state?
As of 2023, Missouri is not a Streamlined Sales and Use Tax Agreement member.
Sales Tax Nexus in Missouri
Businesses with a significant connection or "nexus" to Missouri must register for a seller's permit, collect sales tax on taxable transactions, file returns, and remit collected tax to the state. There are several ways nexus is reached:
Physical Nexus
Any level of physical presence creates physical nexus in Missouri, such as:
- An office, retail store, warehouse, distribution center, or other physical facility
- Employees, contractors, representatives, or agents conducting business in Missouri, even temporarily
- Storing inventory or property in the state
- Making deliveries into Missouri with company-owned vehicles
Even short trips by employees or having a storage locker can meet the physical presence threshold to create sales tax obligations. There is no minimum time or activity requirement.
Economic Nexus
Out-of-state sellers exceeding $100,000 in retail sales from Missouri buyers in the prior 12-month period have economic nexus. This includes online and remote sellers. Once this sales volume threshold is met, the seller must register and begin collecting Missouri sales tax.
The $100,000 economic threshold took effect January 1, 2023. Prior Missouri law determined nexus solely based on physical presence.
Marketplace Nexus
Sellers selling online marketplaces may be subject to Missouri's marketplace nexus provision. Having gross sales exceeding $100,000 in the prior year resulting from marketplace referrals and facilitation creates an obligation on the seller concerning Missouri sales tax.
Affiliate Nexus
Missouri affiliate nexus law states that out-of-state sellers are subject to collecting Missouri sales tax if they have ties to Missouri-based businesses who refer sales, solicit orders, or otherwise facilitate the out-of-state retailer's ability to make taxable sales to Missouri buyers.
Missouri Taxable and Exempt Goods
Missouri broadly taxes sales and purchases of tangible personal property (goods), with some exemptions. Whether a product is taxable depends on how it meets the definitions in Missouri tax statutes and regulations.
Commonly Taxable Goods
- Clothing and footwear
- Furniture and home furnishings
- Medical devices and equipment (some exemptions apply)
- Groceries and prepared foods
- Personal hygiene products
- Cleaning supplies
- Pet food and supplies
Commonly Exempt Goods
- Unprepared grocery food items
- Prescription drugs and medicines
- Specific medical devices (prosthetics, braces, wheelchairs, etc)
- Textbooks and other educational materials
- Farm equipment and machinery
Sellers must collect valid exemption certificates from buyers to substantiate any non-taxed transactions. Records should be retained for at least 3 years.
FAQs
Are groceries taxable in Missouri?
Most grocery food items are taxed at the reduced 1.225% state tax rate in Missouri. Prepared foods are taxed at the full rate.
Is clothing taxable in Missouri?
Yes, clothing purchases in Missouri are subject to the full applicable sales tax rate. There is no broad exemption for clothing.
Are digital products taxable in Missouri?
Yes, digital products like ebooks, streaming media, apps, and software downloads are taxable in Missouri. There is no digital products exemption.
Is software-as-a-service (SaaS) taxable in Missouri?
No, SaaS and other online services are generally not subject to Missouri sales tax.
Are services taxable in Missouri?
Most services are not taxable in Missouri. However, some taxable services include telecom, fabrication labor, utilities, and business services.
Excise Taxes in Missouri
Missouri levies excise taxes on alcohol, tobacco, medical marijuana, and motor fuel. Rates vary by specific product.
Food and Beverage Tax in Missouri
There is no general food and beverage tax. However, prepared foods sold for immediate consumption may be taxed at the full state + local rates instead of the reduced 1.225% grocery rate.
Remote Sellers & Missouri Sales Tax
Remote sellers with over $100,000 in sales from Missouri buyers have economic nexus and must collect applicable sales tax. Use tax applies to remote sales when the seller doesn't collect sales tax.
Prepaid Sales Tax on Fuel
Motor fuel, diesel, and aviation fuel are subject to Missouri's prepaid excise tax rates. Suppliers and importers of fuel products prepay the taxes.
Local Sales Taxes
On top of Missouri's 4.225% statewide sales tax rate, dozens of local jurisdictions also impose sales taxes, leading to combined rates of over 10% in some areas.
Collecting Sales Tax in Missouri
Once registered for a Missouri seller's permit, retailers must charge, collect, report, and remit the applicable sales tax rates on taxable sales and transactions. Collecting, filing, and remitting sales tax is crucial for Missouri business tax compliance.
Collecting Tax as a Missouri Retailer
For sellers located in Missouri, charging sales tax is straightforward. Missouri is an origin-based sales tax state, meaning sellers must collect tax based on the rates in effect at the point of sale.
If a Missouri retailer has a single store location, that retailer will charge the combined state sales tax rate of 4.225% plus any county/city rates based on their store's geographic jurisdiction.
Retailers with multiple locations in Missouri should charge sales tax rates according to where each transaction occurs. If making a sale from their St. Louis store, they'd collect that city's 9.679% combined rate. And transactions from their rural Jefferson City outlet would ring up at just the 4.225% state tax.
Collecting Tax as an Out-of-State Seller
Remote sellers with nexus in Missouri but no in-state physical locations have slightly more complexity in collecting the proper tax.
Out-of-state retailers with over $100,000 in Missouri sales now have economic nexus and must collect applicable tax. These remote sellers may simply collect and remit Missouri's 4.225% statewide rate. However, buyers still owe any additional use taxes to their jurisdiction, so some sellers voluntarily collect based on the delivery destination.
Automated sales tax software helps correctly apply origin-based and destination-based taxes for remote and omnichannel sellers.
Should You Collect Tax on Missouri Shipping Charges?
Missouri does not subject delivery, shipping, handling, or transportation charges to sales tax if they are separately stated on the invoice or billing statement.
So sellers should break out shipping as its line item to exclude it. Otherwise, tax may be charged if shipping is lumped together with the product cost.
Keeping shipping charges separate from taxable goods and services avoids the need to collect extra Missouri sales tax on those fulfillment fees.
Filing & Paying Missouri Sales Tax
Properly filing sales tax returns and remitting collected revenue to the state is a legal obligation for all sellers with nexus in Missouri. Understanding the filing schedule, due dates, and procedures is important for compliance.
Filing Missouri Sales Tax Returns
The Missouri Department of Revenue assigns each seller a filing frequency—monthly, quarterly, or annual. This determines how often businesses need to send in sales tax payments and report their taxable transactions from the preceding period.
Higher volume sellers will be required to file monthly or quarterly. Smaller retailers may only need to submit an annual sales tax return. Here are the due dates:
Monthly Missouri Filing Due Dates
Quarterly Missouri Filing Due Dates
Annual Missouri Filing Due Date
When it's time to file, Missouri sellers must report their gross sales, itemize taxable transactions, calculate total state and local tax due, and remit payment to the Department of Revenue.
Online filing is required for monthly and quarterly filers, while annual returns can be submitted by paper if necessary.
Penalties for Late Filing or Non-Payment
If a seller misses a Missouri sales tax due date or fails to pay on time, penalties and interest may apply:
Late Filing or Payment: 5% penalty per month up to 25%
It's critical for businesses to file $0 returns even for periods with no taxable sales. The state requires this to verify ongoing compliance.
Sales Tax Return Extensions
Missouri can grant filing extensions for sales and use tax returns if the seller requests no later than one month after the original due date. However, interest still applies to any tax not paid on time.
Missouri Sales Tax Audits & Appeals
Inevitably, some Missouri businesses will face sales and use tax audits by the Department of Revenue to ensure proper compliance. Knowing what to expect and how to contest questionable findings is essential.
The Missouri Sales Tax Audit Process
Below are the standard steps once a Missouri seller is chosen for audit:
- Notification: The business receives audit notice from the DOR. A pre-audit questionnaire may be requested.
- Information Request: The auditor asks for access to records, sales data, exemption certificates, bank statements, tax returns, and other files.
- Examination: The auditor compares filings to bank deposits, exemptions, and other records to identify unremitted tax liabilities.
- Audit Report: Preliminary findings outline areas of disagreement and additional tax assessments.
- Appeal: Businesses can contest audit results with more documentation within 30 days. Further appeals are possible.
Contesting Audit Findings
If the auditor's conclusions or tax assessments seem incorrect or unreasonable, sellers should promptly consult an experienced Missouri sales tax professional to determine grounds for appeal.
Common reasons to challenge audit results include:
- Legal misinterpretation
- Procedural errors
- Unfair/incomplete examination
- Exemptions supported by valid certificates
Documented appeals submitted through proper DOR channels can help resolve disputes without needing court proceedings.
Registering for a Missouri Sales Tax Permit
Registering with the Missouri DOR is the crucial first step before making any taxable sales. Sellers can register online in a few quick steps:
- Visit Missouri DOR Registration Page
- Provide business identification details, ownership structure, products sold, and projected revenues
- Submit the registration form and fee payment
- Collect sales tax on future taxable transactions using a new permit/license
Out-of-state sellers exceeding Missouri's $100,000 economic nexus threshold are also required to complete this registration process before the obligation kicks in.
More Missouri Sales Tax Resources
For additional guidance on Missouri sales tax filing, audits, and appeals, contact:
- Authority: Missouri Department of Revenue
- Phone: (573) 751-7200
- Website: dor.mo.gov
There you have it—a comprehensive guide on Missouri's sales tax laws. Need help filing taxes for your ecommerce store? Get a demo with Numeral now.
