Learn more about keeping your business compliant with sales tax requirements.
In Missouri sales tax is levied on all sellers for the privilege of engaging in the business of selling tangible personal property or rendering taxable services at retail. The sales tax is imposed on the following sales or charges (including leases or rentals):
Leases. In Missouri, the lease or rental of tangible personal property is subject to sales tax. However, no tax is imposed if the lessor or renter paid sales tax when the property was purchased or if the sale of the property would be exempt from sales and use taxes.
Sales and use tax rate. The state sales tax rate is 4.225 percent. Cities, counties and certain districts may also impose local sales taxes as well, so the amount of tax sellers collect from the purchaser depends on the combined state and local rate at the location of the seller. The state and local sales taxes are remitted together to the Department of Revenue. Once the seller remits sales tax to the department, the department then distributes the local sales taxes remitted by the sellers to the cities, counties and districts.
In Missouri sellers are subject to and are primarily responsible for collecting and remitting the sales tax. However, purchasers must pay the amount of sales tax to the sellers.
Absorbing the tax is not permitted. In Missouri it is against the law to refund or offer to refund all or any part of the amount collected, or to absorb the amount of sales tax required to be added to the sales price and collected from the purchaser. As a seller, it is also against the law for you to advertise directly or indirectly that you will absorb the sales tax that is required to be added to the sales price.
In Missouri every person required to collect the sales tax must obtain a license from the Missouri Director of Revenue. There is no charge for the sales tax license.
Missouri has many specific items that are exempt from sales tax — for example, certain prescription medications are exempt from Missouri sales tax. You'll want to check and see if you are exempt from the sales tax. An exemption certificate may be issued by a purchaser of a nontaxable item. The exemption certificate may be based on the type of transaction (such as a resale exemption) or on the item itself.
The seller or vendor has the burden of proving that a sale was not subject to sales or use tax. The seller must obtain exemption certificates from the purchaser and keep them as proof. Each invoice or bill of sale must indicate purchaser from whom an exemption certificate was obtained.
Requirements for resale exemption certificates. Retail certificates may be obtained from the state. As an alternative, Missouri also accepts the multistate exemption certificate that includes the following information:
The seller or vendor has the burden of proving that a sale was not subject to sales or use tax. Sellers may accept blanket certificates from a purchaser that repeatedly purchases the same type of property or service for processing or resale. The seller must obtain exemption certificates from the purchaser and keep them as proof. Each invoice or bill of sale must indicate your name as the purchaser from whom an exemption certificate was obtained. Only one exemption certificate needs to be obtained from the buyer, provided the character of your operation doesn't change and the purchases are claimed under that exemption certificate. However, exemption certificates must be updated every five years.
Missouri has a statute that specifically taxes out-of-state mail order and catalogue sellers. However, you will be responsible for paying this tax only if you have physical presence within Missouri. To determine if you have physical presence, ask yourself the following:
The bracket system may be followed by sellers in computing the sales tax. The 4.225 percent sales and use tax is computed on each dollar and/or fraction of a dollar according to the following table:
|Amount of Sale||Tax|
|$0.00 to $0.11||no tax|
|0.12 to 0.35||$0.01|
|0.36 to 0.59||0.02|
|0.60 to 0.82||0.03|
|0.83 to 1.06||0.04|
|and so forth|
If you included the refunded amounts in a sales tax return you may deduct the refunded amount from the gross receipts required to be stated in your next sales tax return. However, you must return to the purchaser any sales tax paid by the purchaser. If a credit can't be taken on the next filed sales tax return, you can apply for credit from the Department of Revenue. Before a refund will be made, you must show that arrangements have been made for the return of taxes paid by purchasers. Claims for refund must be filed within three years from the date of overpayment.
A compensating use tax is imposed for the privilege of storing, using, or consuming within Missouri any article of tangible personal property. Use tax is not imposed on receipts that were subject to sales tax or on sales that would be exempt from the sales tax if made in Missouri. The liability for the use tax is imposed on persons storing, using, or consuming tangible personal property in the state.However, property brought into the state on which a sales or use tax has been paid in another state that is equal to, or in excess of, the Missouri tax is not subject to tax in Missouri.