2024 Guide to Sales Tax in Columbus, Ohio

What is the Sales Tax in Columbus?

Columbus has a combined sales tax rate of 7.50%. In Ohio, the sales tax rate is composed of multiple components:

• The Ohio state sales tax rate: 5.75%
• A Franklin County sales tax rate: 1.25%
• Any special sales tax rates: 0.50%

What is Franklin County Sales Tax?

Franklin County’s sales tax rate is 1.25%. Often, the county sales tax rates can be lower than the rates charged in cities within that county. This variation is due to some cities imposing additional rates or special tax rates that apply only to specific cities.

In Franklin County, the sales tax amount can vary significantly from one city to another due to some cities having higher rates.

Tax Rates in Columbus, Ohio

Wondering about the variation in sales tax rates in Columbus? Here’s a list of the top 10 zip codes in Columbus and their respective sales tax rates.

Other Tax Rates for Columbus

We’ve now covered the main tax rates for Columbus. Here are some additional tax rates that you might need to charge in this city and state.

What Items are Taxable in Columbus?

In Ohio, not all items are subject to sales tax. For example, prescription drugs are typically exempt from sales tax. The best way to ensure you’re charging taxes on the correct items is to add a Tax Information Code (TIC) to all the items you’re selling so that the correct tax is applied. A TIC is a number assigned to a category of goods or services.

Here is a list of some taxable items in Columbus:

What Items are Exempt from Taxes in Columbus?

In Ohio, several items are exempt from taxes. States typically make certain items tax-exempt to encourage their purchase or because they are deemed essential.

The easiest way to ensure you don’t accidentally charge sales tax on an exempt item is to add a Tax Information Code (TIC) to all your items. A TIC is a number that groups similar goods or services into one category.

Here is a list of some tax-exempt items in Columbus:

Who Needs to Collect Sales Tax in Columbus?

A business is required to collect sales tax in Columbus if they have achieved either physical nexus or economic sales tax nexus in Ohio.

How do you achieve that? By making sales to residents of Franklin County or another city in Ohio either by having a physical presence in Ohio or reaching a specific amount in sales to residents of Ohio within a year.

What is Physical Nexus in Ohio?

Physical nexus in Ohio means that your business has some kind of physical presence in the state. This isn’t limited to having your headquarters in the state – there are many ways that out-of-state sellers can establish a physical presence in Ohio despite being based elsewhere.

What is Economic Nexus in Ohio?

What if you don’t have any physical presence in the state? In Ohio, you can establish economic nexus simply by making $100,000 worth of sales in the state in a year or 200 transactions.

How you qualify for economic nexus in Ohio (full details):

• Count all sales made by your business into Ohio, including wholesale sales, towards your $100,000 economic nexus threshold and 200 transactions.
• The only exception is sales made through a qualifying marketplace where the marketplace facilitator is collecting taxes on your behalf.
• When you meet the threshold for economic nexus, you need to register for sales tax in Ohio immediately and start collecting and remitting sales taxes in Ohio.

How to Get a Sales Tax Permit in Columbus?

If you meet either physical or economic nexus, you’ll need to obtain a sales tax permit in Ohio for all your sales across the state, including in Columbus. Getting your sales tax permit is straightforward and free.

Here are the steps:

1. Visit the Ohio Department of Taxation website.
2. Answer a few questions about your business.
3. Allow the system to identify the necessary permits and register you for them.
4. That’s it!

For more details, visit the State of Ohio’s Sales Tax website.

How Do You Charge the Right Amount for Sales Tax in Columbus?

Ensuring you charge the correct amount in sales tax in Columbus can be challenging since different cities in Franklin County may have varying rates. Here’s how to ensure compliance:

1. Manually check and update rates: You can manage your sales taxes manually by checking the state’s website, which provides updated sales tax rates in cities across the state. However, there are many cities in Franklin County, and sales tax rates may change multiple times a year. Manually checking rates monthly and updating your local, district, and tax rates in your ecommerce platform is essential to ensure you’re always charging the correct amount in sales tax.
2. Use sales tax compliance software: Managing sales taxes manually is time-consuming and can lead to errors. Affordable sales tax compliance software like TaxCloud automates the entire process. It ensures you’re always charging the correct amount by tracking and updating sales tax rates in every jurisdiction where you need to collect taxes.

How Do You File and Remit Sales Tax in Columbus?

Wondering if you need to file sales tax returns specifically for the city or county of Columbus? The good news is no, you don’t. If you have sales tax nexus in Ohio, you can collect sales taxes statewide and file just one state-wide return. When you remit the sales tax you collected to the State of Ohio, they’ll then distribute those funds to the appropriate city, district, or county where the taxes were collected.

If you find the process of filing your Ohio sales taxes time-consuming, TaxCloud can help. We can automate your entire sales tax management process, from tracking your progress towards nexus in every state and registering for sales tax to filing your sales taxes. TaxCloud takes care of filing sales taxes so you can focus on growing your business.

Find out how TaxCloud can help your business simplify sales taxes.