Everything You Need to Know About Sales Tax in Texas in 2025

Sales tax in Texas is a critical requirement for businesses that sell goods or services in the state.

In this blog, we will explore everything you need to know about this tax, including:

• Who is required to pay it
• Important filing deadlines for 2025
• Strategies to simplify tax management

Stay ahead of tax regulations and ensure your business stays compliant efficiently.

1. What Is the Sales Tax Rate in Texas?

The base sales tax rate in Texas is 6.25%, but local governments (cities, counties, and special districts) can add up to an additional 2%, making the maximum total rate 8.25% in some areas.

Who Needs to Pay Sales Tax in Texas?‍

Sales tax applies to:

✔ Businesses selling tangible goods.
✔ Companies providing taxable services (such as maintenance, repair, or storage).
✔ Sellers of digital goods, including downloadable music, software, or e-books.

If you operate a physical store, an online business, or sell through marketplaces like Amazon, you must register to collect and remit sales tax in Texas.

Need help registering your business in the U.S.? Check out our guide: How to Register an LLC in the U.S.

2. How to Calculate Sales Tax in Texas

Follow these simple steps to calculate the sales tax on your sales:

1️⃣ Determine the applicable tax rate: Combine the state tax rate of 6.25% with the local tax rate (typically 1% to 2%).
2️⃣ Multiply the product price by the tax rate:

• Example: If you sell a product for $100 in an area with a total 8% tax rate, calculate:
  $100 x 0.08 = $8 sales tax.

3️⃣ Add the tax to the final price:

• The customer will pay $108 total ($100 product price + $8 tax).

3. Important Deadlines for Filing Sales Tax in 2025

Sales tax is usually due on the 20th of the month following the tax period. To avoid penalties, make sure to file and pay on time.

Need more details on tax deadlines? Read our article: Key Tax Filing Deadlines in the U.S. in 2025.

Common Sales Tax Exemptions in Texas

Some goods and services are exempt from sales tax, including:

✔ Basic food items (bread, milk, fruits).
✔ Prescription medications.
✔ Certain agricultural equipment.

📌 Tip: Reviewing exemptions can help optimize your tax management and reduce unnecessary tax payments.

4. Penalties for Late Sales Tax Filing or Payment

Failing to file or pay sales tax on time can result in significant penalties, such as:

❌ 5% late penalty if unpaid, increasing to 10% after 30 days, plus a $50 additional fine.
❌ Accrued interest based on the unpaid balance.

5. How to Pay Sales Tax in Texas

You can file and pay sales tax through the Texas Comptroller's online portal.

1. ‍Register your business with the Texas Comptroller.
2. ‍Report your sales and tax collections based on your reporting period (monthly, quarterly, or annually).
3. ‍Submit your payment before the deadline to avoid fines.

Optimize Sales Tax Compliance with Prodezk

Managing sales tax compliance can be complex, especially if you sell locally and internationally.

At Prodezk, we provide:

• ‍‍Comprehensive support to help your business stay compliant with Texas sales tax regulations.‍
• Automated tax calculation tools to streamline reporting and payments.

📌 Explore More Resources:

• How to Calculate Sales Tax for a Marketplace
• Sales Tax in Florida: What You Need to Know

6. Conclusion

Complying with sales tax regulations in Texas is essential to operating legally and avoiding penalties. From understanding applicable tax rates to filing on time, staying informed is the key to success.

📩 Need help with sales tax compliance? Contact us today!