Starting a business in Washington is an exciting step, whether you’re opening a brick-and-mortar store or selling online. However, one essential task that can’t be overlooked is securing a Washington sales tax permit. This permit ensures that your business complies with state tax regulations, allowing you to legally collect and remit sales tax on taxable sales made within the state.
In this guide, we’ll walk you through everything you need to know about obtaining a sales tax permit in Washington, from determining if you need one to the registration process and important tips to stay compliant.
Key Takeaways
- Requirement: Washington businesses, remote sellers exceeding $100K in sales or 200 transactions annually, and marketplace facilitators must obtain a sales tax permit.
- Cost: There is no fee to register for a sales tax permit, though business license fees may apply.
- Processing Time: Online applications are typically processed within 10 business days, with additional time needed for city or state endorsements.
- Remote Sellers: Must register if they meet Washington’s economic nexus threshold ($100K in sales or 200 transactions).
What is a Sales Tax Permit in Washington?
A Washington sales tax permit is a registration that allows you to legally collect and remit sales tax on taxable goods or services sold in Washington. The permit is necessary for maintaining compliance with Washington’s state and local sales tax regulations.
Both in-state businesses and remote sellers must register if they meet certain criteria, like having a physical presence in Washington or exceeding the economic sales tax nexus threshold. This permit not only allows you to collect tax but also ensures that the sales tax is properly remitted to the Washington Department of Revenue.
Without this permit, businesses cannot legally collect sales tax, risking non-compliance and potential fines. Whether you are an established business or a new seller, registering for a state of Washington sales tax permit is a must.
Do You Need to Register for a Sales Tax Permit in Washington?
In Washington, certain businesses must register for a sales tax permit. The following checklist will help you determine whether you need to apply:
- In-state sellers: If your business operates with a physical nexus in Washington, such as an office, warehouse, or storefront, and you sell taxable goods or services, you must register for a Washington sales tax permit.
- Remote sellers: If you are based outside of Washington but make sales to Washington customers, you may need to register. Remote sellers should collect sales tax if they exceed the economic nexus threshold, more than $100,000 in gross sales in Washington per year.
- Marketplace facilitators: If you sell on an online marketplace such as Amazon or eBay, the platform itself may be responsible for collecting and remitting sales tax. However, you might still need to register if you make sales outside of the platform or exceed the sales tax threshold.
- Economic nexus: Even if your business doesn’t have a physical presence in Washington, you may still be required to register for a Washington sales tax permit if you exceed the sales threshold or number of transactions.
Step-by-Step: How to Get a Sales Tax Permit in Washington?
To successfully obtain a Washington sales tax permit, follow these steps:
- Gather Required Information: Before starting your registration, collect the information like business name, address, contact information, etc.
- Complete the Business License Application: If you meet the registration requirements, apply for your business license through the Washington Department of Revenue.
- Register with the Department of Revenue: Once you have all the necessary information, proceed with Washington sales tax registration by completing the online application at the Washington Department of Revenue’s portal. You’ll need to create an account with the My DOR system.
- Submit Your Application: After filling out the online application, submit it to the Department of Revenue. This will allow you to receive your Unified Business Identifier (UBI) number.
- Wait for Approval: Once your application is submitted, you can expect to receive your Washington sales tax permit within 10 business days. If additional city or state endorsements are required, the process may take longer (2–3 weeks).
- Start Collecting and Remitting Sales Tax: Once you’ve received your sales tax permit, you must begin collecting sales tax on taxable sales. Keep in mind that you need to remit the sales tax to the state and file returns regularly (monthly, quarterly, or annually, depending on your sales volume).
What Information Do You Need to Register?
To ensure a smooth application process, make sure you have the following details ready:
- Business Information: Federal Employer Identification Number (EIN), Projected monthly sales and taxable sales, Type of products or services you will sell, Business start date, and legal structure of your business (sole proprietorship, LLC, corporation, etc.).
- Employer Identification Number (EIN): An EIN is required if your business has employees or is registered as an LLC or corporation. You can obtain an EIN from the IRS.
- NAICS Code: The NAICS code identifies the primary activity of your business. It’s used to classify your business type for tax purposes.
- Responsible Party Information: The individual responsible for the business, including their name, address, and contact details.
How Much Does It Cost to Register for a Sales Tax Permit in Washington?
Registering for a Washington sales tax permit is free, but there are variable business license processing fees:
- Open/reopen a business: $50
- Add an additional location: $0
- City Non-Resident Business Endorsement: $0
- Other purposes (e.g., hiring employees, registering a trade name): $10
- Annual Renewal fee: $5 (late renewal penalty: up to $150)
These fees apply depending on your business situation and endorsements required.
How Long Does It Take to Get Approved?
If you apply online, your Washington sales tax permit should be processed within 10 business days. If additional city or state endorsements are required, it may take an extra 2–3 weeks for approval. To speed up the process, create an account in the My DOR system, which will also be used for tax filing and making changes to your business.
If you apply by mail, your Business License Application and additional forms can take up to six weeks to process.
Common Mistakes to Avoid When Registering
To avoid delays in getting your Washington sales tax permit, keep an eye out for these common mistakes:
- Incorrect business structure: Ensure you select the correct legal structure, such as sole proprietorship, LLC, or corporation.
- Failure to account for economic nexus: If you meet Washington’s economic nexus threshold, make sure to register appropriately.
- Missing responsible party details: Ensure the responsible party’s information is complete and accurate.
- Incorrect contact details: Double-check that your business’s contact details are accurate to receive all necessary updates.
What Happens After You Register?
After registering for your Washington sales tax permit, here’s what to expect:
- Filing Frequency: You’ll be assigned a filing frequency (monthly, quarterly, or annually) based on your sales volume. Even if you have no taxable activity, you must file zero returns.
- Account Setup and UBI: You’ll receive a Unified Business Identifier (UBI) number, which is used for tax filings and business changes. Set up your My DOR system account to manage your filings.
- Stay Compliant:
- Collect and remit sales tax on taxable transactions.
- File returns on time, even with no sales (zero returns).
- Maintain accurate records.
Here’s your filing frequency based on annual sales:
| Sales Volume | Filing Frequency |
| Less than $500,000 in annual sales | Annual |
| $500,000 – $2,000,000 | Quarterly |
| Over $2,000,000 | Monthly |
Make sure to check for other local and state requirements, including any additional licenses or property tax filings.
Special Considerations for Out-of-State or Remote Sellers
For remote sellers, Washington’s remote seller sales tax registration rules require you to collect and remit sales tax if your business exceeds the economic nexus threshold. The threshold is $100,000 within the state.
Additionally, marketplace facilitators may be responsible for collecting sales tax on your behalf for sales made through their platform. However, you may still need to register and report sales made outside of the marketplace.
Resources & Where to Register
To register for a sales tax permit in Washington State, follow these steps:
- Register Online: Complete your registration through the Washington State Department of Revenue’s Business Licensing Service.
- Manage Your Account: Access your account via the My DOR portal.
- Contact Information: For assistance, you can contact the Washington State Department of Revenue’s Business Licensing Service at 360-705-6741.
For businesses managing multi-state registrations or seeking streamlined compliance, Commenda offers a comprehensive sales tax platform. Commenda simplifies the registration process and ongoing tax management for businesses operating in Washington and beyond, providing automated solutions for nationwide compliance needs.
Simplify Sales Tax Compliance with Commenda
Managing sales tax registration in Washington and compliance can be time-consuming. Commenda’s global sales tax platform simplifies this process for remote sellers, online retailers, and marketplace facilitators with automated registration, multi-state compliance, and continuous filing support, removing the guesswork.
Commenda also offers expert guidance on choosing the right business structure, efficiently handles the filing of required documents, and assists with obtaining proper business licenses and permits. Plus, it helps you stay compliant with Washington’s evolving legal requirements.
If you want to streamline your Washington sales tax permit process and maintain ongoing compliance with ease, Commenda is the platform to choose. Book a free demo to learn more.
