If you sell tangible personal property or certain digital property at retail in North Carolina, you must register with the North Carolina Department of Revenue and obtain a Certificate of Registration. This also applies to renting or leasing taxable tangible personal property, service contracts to maintain or repair tangible personal property, admission charges to an entertainment activity, operating a laundry, dry cleaning plant or similar business, or operating a hotel, motel or similar business in North Carolina. The registration requirement also applies if you sell taxable property or provide taxable services at a specialty market, flea market, fair or other similar type of event.
You can register your business online and obtain an account number for North Carolina tax purposes. By registering online you can get your account number instantly. The North Carolina Department of Revenue points out that there is no fee for registering your business.
When you are issued an account number, preprinted sales tax forms are sent to you. But you can also file sales tax returns and pay the sales tax online.
Your filing frequency depends on the amount of your sales tax liability. Once you start filing sales tax returns, you must file a return even if you had no sales during the period. If your liability is more than $100 but less than $20,000 per month, you would file a sales tax return monthly. The return is due by the 20th calendar day of the following month. If your liability is consistently less than $100 a month, you would file quarterly sales tax returns. They would be due by the last day of January, April, July and October for the preceding quarter. If your liability is more than $20,000, you would file monthly, pay the tax by the 20th of the following month and you would have to make a prepayment for next month’s tax liability.
Retail sales of tangible personal property are subject to the general state sales tax rate of 4.75% in North Carolina. According to the North Carolina Department of Revenue, with certain exceptions, sales that are subject to the general state sales tax rate are also subject to a local sales tax at a rate of 2.00% or 2.25%. There is also a 0.50% transit tax in Durham, Mecklenburg, and Orange Counties. You can find a list of the total sales tax rates by county under Tax Rates on the North Carolina Department of Revenue website.
Sales of qualifying food items are not subject to the state tax; they are only subject to the 2.00% food rate. Qualifying food items do not include processed foods or soft drinks.
If you are exclusively in the business of selling wholesale, you would not be required to file sales tax returns. But if on two or more occasions during a twelve-month period you make taxable sales to users, consumers or merchants you would no longer be considered to be exclusively a wholesaler and would have to start filing sales tax returns. However, if you make taxable sales on only one occasion in a twelve-month period, you could file a sales tax return for that period only and pay the tax by the 20th of the following month.
If you purchase taxable property for resale and are not subject to the sales tax, you must provide the vendor with a Form E-595E, Streamlined Sales and Use Tax Agreement Certificate of Exemption, which is a multi-state form, or other evidence that you are registered for sales tax purposes and that the property is being purchased for resale.
If you have a seasonal business that you operate for six months or less during the year, you can register as a seasonal filer. This way you would not be required to file sales tax returns during your off season.
Filing Requirements & Registration, North Carolina Department of Revenue
Form E-505AC, To Newly Registered Taxpayers, North Carolina Department of Revenue
Form E-595E, Streamlined Sales and Use Tax Agreement Certificate of Exemption
Online Business Registration, North Carolina Department of Revenue
Sales and Use Tax Frequently Asked Questions, North Carolina Department of Revenue
Tax Rates, North Carolina Department of Revenue