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Last Updated: 10/26/2017

Frequently Asked Questions

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Sales and Use Tax

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Sales and Use Tax > Resources

  • Why didn't I receive a payment voucher?Back to top

    The Department of Revenue sends out Sales and Use Tax payment vouchers at the beginning of the year, but not to all taxpayers. If you’re required to electronically pay any business tax to the department, you must pay all business taxes electronically. If you’ve paid electronically at any time during the last three years, you won’t receive a payment voucher.

    If you’re not required to pay electronically, and you want to pay by check, use our e-Services Payment Voucher System to create and print the payment voucher you need to mail with your check or money order payments.

  • What is use tax?Back to top

    Use tax complements sales tax and applies when you buy, lease or rent taxable items or services and aren’t charged sales tax by the seller. Use tax is based on the cost of your taxable purchases, like sales tax (and subject to the same exemptions). You are responsible to pay use tax, when owed.  ​

  • Who needs to register?Back to top

    You must register to collect sales tax if you make taxable retail sales in Minnesota. This includes businesses outside Minnesota who:

    • have an office, distribution, sales, or sample room location; warehouse or other place of business in Minnesota, either directly or by a subsidiary
    • have a representative, agent, salesperson, canvasser, or solicitor in Minnesota – on either a permanent or temporary basis – who operates under the authority of the retailer or its subsidiary for any purpose
    • deliver items into Minnesota in their own vehicles
    • provide taxable services in Minnesota

    If you make retail sales in any cities, counties, or other local taxing areas that have a local sales tax, you must also register the local sales tax(es).

    If you don’t have taxable sales in Minnesota, but you make taxable purchases, you must register to pay use tax.

  • How often do I need to file Sales and Use Tax?Back to top

    Sales and Use Tax may be due on a monthly, quarterly, or annual basis. The due date is based on the average monthly tax you reported in the previous year, as shown in the table below. 

     
    Filing Frequency Average Tax Reported Due Date​
    Annual​ Less than $100 per month​ Feb. 5 of the following year​
    Quarterly Less than $500 per month​ 20th day of the month after the end of the quarter​
    Monthly More than $500 per month​ 20th day of the month after the end of the month
     
    When a due date falls on a weekend or legal holiday, the due date is the next business day.

     

  • Who administers local taxes? Back to top

    By law, the Department of Revenue must administer all general local Sales and Use taxes.
    However, each local taxing jurisdiction may choose whether to administer their own special local taxes, or to have the department do it. Lodging, entertainment, food and beverage are some examples of special local taxes.

  • What services are taxable? Back to top

    • Admissions
      • Admissions to places of amusement (including recreational areas and athletic events)
      • Making available amusement devices (including video games and games of chance)
      • Making available health clubs, spas, tanning facilities, reducing salons, steam baths, or athletic facilities
      • Granting membership to a sports or athletic facility
    • Building cleaning and maintenance
    • Delivery of aggregate
    • Detective, security, and alarm services
    • Laundry, dry cleaning, and alterations services
    • Lawn, garden, tree, and bush services
    • Lodging and related services
    • Massages (not medically prescribed)
    • Motor vehicle towing, washing, waxing, rustproofing, and cleaning services
    • Parking services
    • Pet grooming, boarding, and care services
    • Telecommunication services
    Within each of these broad categories there are some activities that are not taxed.
     
    See our sales tax fact sheets and industry guides for more information.

  • What is an acceptable exemption certificate? Back to top

    If a purchaser is exempt from paying sales tax, they must provide the seller with a fully completed exemption certificate at the time of the purchase. Purchasers are responsible to know if they qualify for an exemption, and they will be held responsible for any tax, interest and penalties that apply if the purchase isn’t eligible for an exemption.

    The Minnesota Department of Revenue accepts the following forms as valid exemption certificates:

    • Form ST3, Certificate of Exemption (Minnesota Department of Revenue form)
    • Form F0003, Certificate of Exemption (Streamlined Sales Tax form)
    • Uniform Sales and Use Tax Certificate (Multistate Tax Commission form)
    • Exemption certificates from other states, if they meet the requirements below
    • Exemption certificates prepared by the purchaser, if they meet the requirements below

    An exemption certificate must contain the following information to be valid:

    • Purchaser’s name and address
    • Purchaser’s Minnesota tax ID number or if they don’t have one, any of the following:
      • Tax ID number from another state (and list the state of issue)
      • Federal employer ID number (FEIN)
      • Driver’s license (and list the state of issue) 
    • Purchaser’s type of business
    • Reason for the exemption
    • Purchaser’s signature

  • Are local governments subject to sales taxes? Back to top

    Most purchases by local governments in Minnesota are exempt from the state’s 6.875 percent general rate Sales and Use Tax.

    Local governments are exempt from general local sales or use taxes. However they must pay other special local taxes such as lodging, entertainment, and food and beverage.

    For detailed information on when local governments are exempt from Sales and Use Tax, see Fact Sheet 176, Local Governments – Cities, Counties, and Townships.

  • Are labor charges taxable?Back to top

     

    Sometimes. It may depend on the type of labor and whether it’s listed separately on an invoice. 
    Taxable labor charges include:
    • Fabrication labor – to make or create a product, or to alter an existing product.
    • Installation labor – to set an item of tangible personal property or equipment into position, or to connect, adjust or program it for use.
    Non-taxable labor charges include:
    • Construction labor – to attach an item or materials to a building or land (“real property”).
    • Repair labor – if listed separately from materials or parts on the invoice.
    For detailed information on when labor charges are taxable, seeFact Sheet 152A, Labor - Installation, Fabrication and Construction andFact Sheet 152B, Labor - Repair.

     

  • What is “nexus”?Back to top

    For Minnesota tax purposes, “nexus” means your business has a taxable presence or sales in the state and must report and pay Minnesota taxes.

    Your business has nexus in Minnesota if it has a building or facility in the state. Your business may have nexus if you or another representative of the company make sales or perform other business activities in Minnesota. For more detailed information, see Revenue Notice 00-10, Sales & Use Tax - Nexus Standards.

    Unsure whether you have nexus in Minnesota? You may complete and submit Form ST101, Minnesota Business Activity Questionnaire for Determining Sales Tax Nexus. We’ll review the questionnaire and notify you if you are required to register and collect Minnesota Sales and Use Tax.

  • How do I update my business information? Back to top

    If you have a Minnesota tax ID number, you can make some changes through our e-Services system. For other changes, you may have to contact our Business Registration unit.

    For more information, see Update Business Information.

  • Why am I being charged a local tax that you don’t have listed on your website? Back to top

    By law, the Department of Revenue must administer all general local Sales and Use taxes. However, each local taxing jurisdiction may choose whether to administer their own special local taxes, or to have the department do it. Lodging, entertainment, food and beverage are some examples of special local taxes.

    For information about a local sales tax not listed on our website, contact the local government where the purchase was made.