Texas sales tax permit: who needs it, the fee and how to apply

The Texas sales tax permit at a glance

The Texas sales tax permit, which the state calls the Texas sales and use tax permit, is issued by the Texas Comptroller of Public Accounts (the Comptroller). Many people search for a Texas sales tax license; it is the same permit. You must hold one if you are an individual, partnership, corporation or other legal entity engaged in business in Texas and you sell or lease goods or sell taxable services. Law checked on 3 Oct 2026 on comptroller.texas.gov.

The table sums up the rules. Every value comes from the Comptroller's own pages, linked in the sources below.

Who needs a Texas sales and use tax permit

Two tests decide whether you need a Texas sales and use tax permit: whether you are engaged in business in Texas, and whether you sell something taxable.

You are engaged in business in Texas if, among other things, you have a temporary or permanent location in the state, or you have an employee or representative in Texas who sells, delivers or takes orders for taxable items.

Taxable items are mostly goods. The Comptroller defines tangible personal property as personal property that can be seen, weighed, measured, felt, or touched. Some services are taxable too, including amusement, cable television, data processing and telecommunication services.

In practice, a business that is engaged in business in Texas needs the permit if it does any of the following:

• Sells physical products in Texas, online or in person.
• Rents or leases goods in Texas.
• Sells a service that Texas taxes.

A seller outside Texas needs the permit once it has revenue from Texas of $500,000 or more in the past 12 months, unless it sells only through a marketplace that collects the tax for it (covered below).

Handmade goods count. The Comptroller says people who are engaged in business selling taxable items, including artists or craftsmen who make items for sale, cannot use the occasional sale exemption described further down.

Texas sales tax permit fee and security bond

The Texas sales tax permit costs nothing: the Comptroller charges no fee for it.

The one possible cost is a bond. Per the Comptroller, you may be required to post a security bond. The bond is intended to secure future sales tax, and the Comptroller may ask for one if it has reason to believe that a tax due is likely to become delinquent. The Comptroller says to contact a field office for details on bonds.

Be careful with websites that charge a fee to file the application for you. The application on comptroller.texas.gov is the official route and has no fee.

How to apply for a Texas sales tax permit

You can apply online or on paper. These steps follow the Comptroller's application pages.

1. Check that you can use the online application

   Applicants must be at least 18 years of age. Parents/legal guardians may apply for a permit on behalf of a minor. You cannot use the online application if you are a sole owner, partner, officer or director and do not have a social security number; in that case use the paper form.

2. Gather your documents

   The Comptroller's checklist includes these items. Sole owners: Sole owner's Social Security number. Texas corporations: Texas corporation's file number from the Texas Secretary of State. All applicants: North American Industrial Classification System (NAICS) code required for all businesses. You can apply without including a federal identification number, so a sole owner without an EIN can still apply.

3. Submit the application

   Apply online through the Texas Online Sales Tax Registration Application System on comptroller.texas.gov. The paper option is Form AP-201, Texas Application for Sales and Use Tax Permit, which you mail to the Comptroller.

4. Wait for the permit

   The Comptroller says to allow 2-3 weeks to receive your permit. After approval you get a letter saying whether you file monthly or quarterly.

5. Post the permit and start collecting

   Once the permit arrives, two duties start right away. Post your permit at your place of business. Collect sales tax on all taxable sales.

Selling on Amazon, Etsy or eBay from Texas

Texas treats marketplace sellers differently depending on where they are based. A marketplace provider is a company that runs a marketplace and processes sales for sellers. The Comptroller's examples are Amazon, eBay, Walmart Marketplace, and Etsy.

Marketplace providers engaged in business in Texas must collect, report and remit state and local sales and use tax on all sales made through a marketplace. So the marketplace collects the tax on those orders. Even so, if you are based in Texas, you are still responsible for having a Texas tax permit and filing your sales and use tax returns timely. The Comptroller adds that this applies even if your only sales are through a marketplace provider.

Out-of-state sellers have a simpler rule. Remote sellers who sell only through a marketplace provider are not required to hold a Texas tax permit. They must still keep records of marketplace sales for at least four years.

If a marketplace does not certify that it collects Texas tax for you, you should collect sales and use tax until you receive a certification.

The relief covers marketplace orders. In the Comptroller's words, a marketplace seller is not responsible for collecting and remitting sales and use tax on your sales through the marketplace when the marketplace provider has certified that it collects the tax.

Out-of-state sellers and the threshold

Remote sellers are, in the Comptroller's definition, out-of-state sellers whose only activity in Texas is the remote solicitation of sales. A remote seller needs a Texas permit once it has revenue from Texas of $500,000 or more in the past 12 months. The total is based on gross revenue from taxable and nontaxable sales, and it also counts sales for resale and sales to exempt entities.

Once over the threshold, a remote seller must get a permit and start collecting tax no later than the first day of the fourth month after the month that a remote seller exceeds the $500,000 safe harbor amount.

Remote sellers may choose a single local use tax rate instead of looking up each local rate. The current single local use tax rate is 1.75 percent. Businesses located in Texas cannot use it.

Selling at fairs, craft shows and markets in Texas

The Comptroller has a separate publication for sellers at fairs, festivals, markets and shows. Sellers at these events, including sellers from outside Texas participating at these events, are engaged in business in Texas. They need a Texas sales and use tax permit if they sell, take orders for, or promote taxable items at the event.

Out-of-state vendors are covered too: if you are an out-of-state seller engaged in business in Texas, even if operating here temporarily, you need the permit. The Comptroller also warns that sellers who operate without a permit may face a penalty.

A few rules matter at events:

• Tax rate: if you sell at different events around Texas, you will collect tax based on the location of each event.
• Promoters: event promoters collect and remit tax on their own sales and on sales made by individuals, dealers or salespersons at these events who do not have an active Texas Sales and Use Tax Permit.
• Booth fees: booth fees, floor space fees and space rental charges are not subject to sales tax.
• Admission: Admission fees are taxable.
• Craft and antique malls: if the market or mall has a central cash register, both the market and the individual sellers must have sales tax permits.

When you do not need a permit: occasional sales

People who sell personal items now and then may qualify for the occasional sale exemption, and then need no permit. You qualify if you sell only one or two taxable items during any 12-month period, or if you sell items bought for personal use and make no more than $3,000 on those sales in a calendar year.

The exemption does not cover a business. It is not available to anyone engaged in business selling taxable items, including artists or craftsmen who make items for sale, or to people who buy items to resell.

What a Texas sales and use tax permit requires after approval

Holding the permit comes with duties. Per the Comptroller, you must:

• Post your permit at your place of business.
• Collect sales tax on all taxable sales.
• Pay sales and use tax on all taxable purchases.
• Timely report and pay sales and use taxes.
• Keep records for a minimum of four years.

Due dates depend on your filing schedule. Monthly returns are due on the 20th of the month following the reporting month. Quarterly returns follow the pattern April 20 to report Jan. – March, and so on each quarter. Yearly filers report the previous year by Jan. 20. You must file even if there are no taxable sales or purchases to report.

Filing on time earns a discount of 0.5 percent of the amount of tax timely reported and paid. Filing late costs A $50 penalty per late report. If tax is paid 1-30 days after the due date, a 5 percent penalty is assessed. If tax is paid over 30 days after the due date, a 10 percent penalty is assessed. Interest is charged beginning 61 days after the due date.

With a permit you can also buy inventory tax free by giving your supplier Form 01-339, Texas Sales and Use Tax Resale Certificate.

Moving, adding locations, changing owners or closing

Texas requires a tax permit for each active place of business. A place of business is one where you receive three or more orders for taxable items in a calendar year; a warehouse or storage yard counts only if it receives orders at that rate.

The permit is tied to its owner. It cannot be transferred from one owner to another. Your business needs a new permit if there are any changes in ownership, and when a sole proprietor incorporates or forms an LLC, it is considered a change of ownership. The new business needs its own permit.

If you stop selling, close the location and return your permit to the Comptroller’s office for cancellation. An active permit keeps the duty to file returns.

Rules can also vary by city and county, which set their own local tax rates. This page is general information, not legal or tax advice. Check the Comptroller's pages every six months and after each Texas legislative session, since the rules can change.

Where Nation fits

Questions about the Texas sales tax permit