North Dakota Sales Tax

When making sales to customers in North Dakota, it’s important to know if you’re obligated to collect and remit sales tax to the state. Although the regulations surrounding sales tax share some similarities from one state to the next, each state also has its own specific guidelines that can impact exactly who must collect sales tax and at what rate. North Dakota is no exception to this, and whether your small business is based in North Dakota or you ship to customers from out-of-state, it’s important to stay up to date on all state and local rates and requirements.

North Dakota Sales Tax Rates

• ND State Sales Tax Rate: 5.0%
• Local Tax Range: 0% to 3.0% (Cities and counties can levy their own taxes).
• Maximum Combined Rate: 8.0%
• Special Gross Receipts Rates:
  • Alcohol: 7.0%
  • Farm Machinery: 3.0% (New machinery used exclusively for agricultural production).
  • Mobile Homes: 3.0% (New units).

Tax Sourcing

North Dakota is a Destination-Based Sourcing state.

• General Rule: Sales are sourced to the location where the customer receives the product or where the service is provided.

North Dakota Nexus

Any retailer maintaining a place of business in North Dakota is considered to have a significant presence in the state and is obligated to register to collect and remit sales tax on all applicable purchases with the state.

Physical Nexus

For the purposes of establishing sales tax nexus in North Dakota, the state interprets the phrase “retailer maintaining a place of business in the state” to include anyone engaged in the solicitation of sales of taxable goods on a regular or systemic basis through various means. These include but are not limited to radio or television media, catalogs, advertising flyers, telephone, and periodicals.

Other conditions that can trigger a nexus on both a statewide and local level include:

• Having service people installing, repairing, or constructing goods in the state
• Making deliveries with a personal or company vehicle, as opposed to through a common carrier
• Owning property in the state or local jurisdiction
• Having a representative or other agent making sales or deliveries, or taking orders for taxable goods
• Having any type of business location within the state or local jurisdiction

Economic Nexus

Remote sellers must register if they meet the following threshold in the current or previous calendar year:

• Gross Sales: More than $100,000 in taxable sales into North Dakota.
• Simplified Rule: North Dakota repealed the 200-transaction threshold in 2019. You only need to worry about the $100,000 revenue mark.
• Note: Unlike some other states, North Dakota excludes non-taxable and exempt sales from this threshold calculation.

Marketplace Facilitators

Facilitators (Amazon, eBay, etc.) must collect and remit North Dakota tax for all sales they facilitate.

• Reporting: If you sell only through marketplace facilitators, you do not need to register for a North Dakota permit.

What is Taxable in North Dakota

Tangible Goods

Purchases subject to sales tax in North Dakota generally include those of tangible personal property, magazines and other periodicals, and admission for recreational activities. Rentals and leases of tangible personal property, as well as that of hotels and similar accommodations, are also taxable.

Certain tangible goods are also exempt. This list includes groceries, medical devices, prescription drugs, custom software, newspapers, and digital products.

Services

Many services, including communication services, are taxable, with specific exemptions including janitorial services, medical services, and transportation services.

Shipping and Handling

Charges for shipping, transportation, and delivery are taxable in North Dakota as long as the item being shipped is taxable, and labor charges related to the production or installation of a taxable item are taxed as well as long as they’re included in the initial purchase price.

Digital Goods and Services

Digital Products: E-books, digital music, and streamed movies are not taxable in North Dakota (as long as they are transferred electronically without tangible media).

SaaS: Software as a Service is not taxable in North Dakota, as it is considered a service rather than the transfer of tangible property.

Exemptions

North Dakota recognizes organizations and entities like schools, whether public or non-profit private, skilled nursing facilities, federally chartered corporations, assisted living facilities, hospitals, emergency medical providers, and basic care facilities. To qualify, however, these organizations must obtain a Certificate of Exempt Status from the state and present it at the time of purchase. It’s important to note as well that this certificate must be issued by North Dakota, and not the federal government, to qualify.

Sales Tax Holidays

North Dakota does not hold an annual sales tax holiday. The state legislature has discussed them in the past, but none are currently active for the 2026 calendar year.

Registration and Filing

If you make regular sales of tangible personal property to customers in North Dakota, or you are in direct competition with in-state retailers, you must submit an application to collect and remit sales tax to the state. The application is free, although you may be required to make a bond payment before your permit is issued. This bond is eligible for refund after two years as long as you have made timely and accurate payments throughout that period.

You can register by mail or online, and you may also need to obtain a Certificate of Authority from the state if your company was legally established under the regulations of another state. If you choose to file online, you may make payments that way as well. If you file by mail, only payment by mail will be accepted. All relevant forms can be found on the state website.

North Dakota is also a member of the Streamlined Sales Tax Registration System, which allows you to register with all participating states at once. It’s worth looking into, particularly if you make sales into multiple states or plan to in the future. If you do choose to go this route, it’s important to note that you must register with all states covered under the agreement at once.

Filing Frequencies

Depending on your total average sales tax liability for the previous year, or your estimated liability if you’re just beginning to make sales into North Dakota, you may be assigned a monthly, quarterly, or annual filing frequency by the state. In general, you will be required to file monthly if your annual sales tax liability exceeds $25,000. Quarterly filing may be assigned to sellers with an annual liability up to $25,000, although the state will use its discretion to assign annual or semi-annual filing frequencies to sellers with lower total tax liabilities, seasonal sales, or other special circumstances.

Deadlines

Regardless of filing frequency, these payments are due on the last day of the month following the close of the period in question.

Monthly Due Dates

Period	Due Date
January	February 28
February	March 31
March	April 30
April	May 31
May	June 30
June	July 31
July	August 31
August	September 30
September	October 31
October	November 30
November	December 31
December	January 31

Quarterly Due Dates

Period	Due Date
January – March (Q1)	April 30
April – June (Q2)	July 31
July – September (Q3)	October 31
October – December (Q4)	January 31

If you only need to file a North Dakota sales tax return once a year, your filing and payment deadline will be January 31st of the following year to ensure tax compliance. When these due dates fall on a weekend or holiday, payments will be considered timely as long as they’re made online or postmarked by the next business day.

Penalties and Interest

• Late Filing: 5% of the tax due or $5.00 (whichever is greater) for the first month. An additional 5% is added each subsequent month, capped at 25%.
• Late Payment: 5% of the tax due or $5.00 (whichever is greater).
• Interest (2026): For the 2026 calendar year, the annual interest rate is 12.0% (1% per month), calculated from the original due date.

Resources

• North Dakota Sales and Use Tax for Businesses
• North Dakota Sales Tax Guidelines and Publications

North Dakota Sales Tax Software

One particular challenge to keeping compliant with sales tax regulations in North Dakota is the technicality of the nexus laws at both the state and local level. As a result of these statutes, you may or may not have to collect local sales tax on top of the state sales tax when you ship to different parts of the state. Using a tax calculator software tool designed to manage these types of transactions can be a great help in this situation, and TaxTools has exactly the combination of features you need to streamline your sales and record-keeping processes.

Our TaxTools software automatically assigns the applicable rate to any purchase, keeps detailed records of all sales organized by state with location data, and will ensure your returns are filed on time. You can also quickly access a trove of sales and other data through the system, and TaxTools monitors changes to local and state sales tax laws regularly to make sure you’re always up-to-date and following the proper procedures for all transactions. This can greatly simplify your small business processes, and it’s especially convenient if you make sales in multiple states on a regular basis. TaxTools also integrates smoothly with all eCommerce platforms, so you don’t have to change anything else about the way you do business.

If you’re ready to learn more about how TaxTools can help you grow your business while staying on top of ever-changing state sales tax regulations, click here to sign up for a free trial today.

Last updated February 2026