Ohio Small Business Taxation FAQs
Overview
The Ohio Department of Taxation’s website is a great resource for small business owners. In this webpage, we’ll go over a few resources and answer a few Frequently Asked Questions that you might have, which would be especially useful to you to review.
Disclaimer
Please note that this document was not prepared by a professional accountant or tax preparer and is meant for educational purposes only. As such, you are strongly encouraged to seek the advice of professional accountants and/or attorneys to determine your applicable local, state and federal tax requirements.
Please know that every effort has been made to assure that the information presented is accurate and consistent with guidance from the Ohio Department of Taxation. However, the authors, editors, publishers, and/or any sponsoring partners, associations, and joint powers authorities cannot accept responsibility for errors or omissions, or for the consequences of application of information. No warranty, express or implied, is made regarding the contents of this document.
For the most accurate information, please go to Tax.Ohio.gov to contact the Ohio Department of Taxation by clicking on the “Contact Us” button.
Frequently Asked Questions
Do I Need a Vendor’s License?
If you are not sure whether you need a Vendor’s License, refer to page 8, “Do I Need a Vendor’s License?,” of this guide: Starting Your Business in Ohio. You will also be required to answer questions through the Ohio Business Gateway mentioned below that will let you know whether you need a Vendor’s License. A Vendor’s License allows you to collect and remit Ohio sales tax.
How Much is a Vendor’s License?
As of this writing, a Vendor’s License is $25. You will have to pay this amount electronically through ACH debit, so be sure to have your bank information handy.
How Do I Purchase a Vendor’s License?
You will have to sign up for an Ohio Business Gateway Account in order to purchase a Vendor’s License. To do this, click “Login” and then “Create Account.” Note: If you are unable to create an account because the system thinks you are a robot, clear your Internet browser’s cache and cookies, close the browser completely, and then try again. If you try again and still cannot create an account, contact the Ohio Business Gateway Help Desk for assistance.
I Have an Ohio Business Gateway Account, Now What?
Step 1: Answer the questions using the Transaction Wizard. It will tell you what Service Areas you should register for. If “County Vendor License” is one of them, you definitely need a Vendor’s License.
Step 2: After this step, log out of the system and log back in. This will allow your dashboard to reset and the Service Areas suggested to you will appear on your My Business Dashboard. From there, click on “County Vendor License” and answer all of the questions. YOU ARE NOT DONE AFTER THIS STEP!
Step 3: After you are finished, it will take you back to your “My Business Dashboard.” Then, click on the “Ready for Checkout” button, then select the Vendor’s License, then the “Proceed to Cart” button. On this next screen, select “Select ACH Account.” You will be required to enter your bank account and routing number.
What Taxes Do I Need to Pay to The State of Ohio?
Everyone’s small business is different and so are the taxes they are required to pay. For general tax information, refer to page 7, “Tax Requirements,” of this guide: Starting Your Business in Ohio. We always recommend that you follow the advice of professional accountants and/or attorneys to determine your applicable local, state and federal tax requirements.
How Do I File Ohio State Business Income Tax Returns?
In the State of Ohio, Business Income is also reported on personal income tax returns.
Do I Have to Pay Municipal Tax?
In the State of Ohio, you have to pay Municipal Taxes based on the city where you live and the city or cities where you operate your business or work.
Look up the Municipal tax rate by entering your small business’ address on The Finder after clicking “Municipal Tax.”
Do I Have to Pay School District Income/Witholding Tax?
Unlike the Municipal Tax, this depends on where you, and your employees if you have any, live and not where you operate your business. Some school districts do not require you to pay a School District Income Tax and others do. Look up the tax rate by entering your address on The Finder by clicking “School District Income Tax.”
The results will give you information about your School District Number and the Income Tax Rate for that specific school district.
Do I Have to Pay Sales and Use Tax?
This site will help you determine whether or not you have to pay this tax.
Once there, find your question and click on the corresponding drop-down arrows to get the answers. Here are a few questions that you might have.
2. What sales are exempt or excepted from sales tax?
3. What services are subject to the sales tax?
4. What services are not taxable?
Do I Have to Pay Commercial Activity Tax (CAT)?
This depends on your taxable gross receipts in a calendar year. Refer to page 7, “Tax Requirements” of this guide: Starting Your Business in Ohio.
How Do I Pay Taxes in The State of Ohio?
It depends on the type of tax you are paying. Check this website to determine the best way to pay your taxes.
Who Do I Call If I Need Help?
It’s best to contact the Ohio Department of Taxation directly. Check out this list of phone numbers to find the right department to contact.
Saving the phone number in your phone’s contacts is a good time-saving tip!