Indiana Sales Tax Guide 2025: Regulations, Taxes, Standards

Navigate Indiana's sales tax rules with ease using this guide, which covers everything from rates to filing requirements. Keep your business compliant and avoid unnecessary penalties.

Indiana Sales Tax

Sales tax in Indiana has been in place since 1963, starting at 2% to support state revenue. Today, the state imposes a flat 7% rate under Indiana sales tax law, with oversight by the Department of Revenue. Businesses must comply with Indiana sales and use tax rules to manage taxable and exempt transactions effectively.

Indiana Sales Tax Rate

Jurisdiction	Sales tax rate
State tax	7.0%
Local tax	0.0%
Combined Tax	7.0%

Learn more and check out the city-based tax rates in Indiana.

Indiana Sales Tax Calculator

The Indiana sales tax calculator is a useful tool for retailers to accurately determine the total tax owed on taxable transactions. Indiana has a flat sales tax rate of 7%, and retailers must apply this rate to all taxable goods and services unless exemptions apply. Using the calculator ensures accurate tax collection and compliance with Indiana sales tax law.

Scenario: A retailer sells a pair of shoes for $100 in Indiana.

1. State Sales Tax Rate: 7%
2. Calculation: $100 × 7% (0.07) = $7
3. Total Price Charged to Customer: $100 + $7 = $107

If the retailer sells another item, such as protective equipment that qualifies for an exemption, no tax is charged. However, detailed record-keeping of such exempt transactions is crucial to comply with Indiana sales and use tax regulations.

Retailers can rely on an Indiana sales tax calculator to automate these calculations and ensure accuracy for all transactions, reducing the risk of errors or underpayment.

FAQs on Sales Tax

What is the sales tax rate in Indiana?

Indiana has a flat sales tax rate of 7%, which applies to most taxable goods and services statewide.

How to calculate Indiana sales tax?

Multiply the item’s price by the sales tax rate of 7%. For example, $100 × 0.07 = $7 in sales tax.

Sales Tax Nexus in Indiana​

Physical Presence	Any physical presence
Economic Nexus	$100,000 in sales
Marketplaces Nexus	$100,000 in sales via marketplace facilitators

FAQs on Sales Tax Nexus

What is Nexus in Indiana sales tax?

Nexus refers to the connection between a business and Indiana that requires the business to collect and remit sales tax. Nexus can be established through a physical presence (e.g., store, warehouse, or employees) or by exceeding the economic nexus threshold of $100,000 in annual sales. 

What are the Nexus rules for sales tax in Indiana?

Businesses with a physical presence or meeting the economic nexus threshold must register with the Indiana Department of Revenue, collect sales tax, and file regular returns. Remote sellers exceeding the threshold are also required to comply with Indiana sales tax law.

Indiana Sales Tax Exemptions

Indiana offers sales tax exemptions to businesses and organizations for certain purchases, such as goods for resale, manufacturing equipment, and agricultural supplies. These exemptions are governed by Indiana sales tax law and require proper documentation, such as exemption certificates, to claim. Understanding these exemptions helps businesses reduce costs and stay compliant with state tax regulations.

How to obtain an Indiana Sales state tax exemption certificate?

Businesses can obtain an Indiana sales tax exemption certificate by completing Form ST-105 from the Indiana Department of Revenue and providing it to vendors to claim exemptions.

What are qualified for Indiana sales tax exemption?

Items like goods for resale, manufacturing equipment, agricultural supplies, and purchases by nonprofit organizations qualify for Indiana sales tax exemptions under state law.

Is SaaS taxable in Indiana?

Yes, SaaS (Software as a Service) is taxable in Indiana as it is treated as tangible personal property under the state’s tax laws.

Is there sales tax on clothes in Indiana?

Yes, clothing is subject to Indiana’s 7% sales tax, with no general exemptions for apparel. Learn more about clothing sales tax on Indiana.

Does Indiana have sales tax on clothing?

Yes, Indiana applies its 7% sales tax to clothing, making it a taxable item statewide.

What are Indiana exemptions?

Indiana offers sales tax exemptions for goods purchased for resale, manufacturing equipment, agricultural supplies, and certain nonprofit purchases. Exemptions are governed by Indiana sales tax law and require proper documentation.

How do I verify a sales tax exemption certificate in Indiana?

To verify a sales tax exemption certificate, check that the certificate is completed accurately, includes a valid Indiana Taxpayer Identification Number (TID), and is signed by the buyer. Always retain a copy for your records to ensure compliance with state regulations.

How do I get an Indiana sales tax exemption certificate?

To obtain an Indiana sales tax exemption certificate, complete Form ST-105 from the Indiana Department of Revenue, providing your business details and reason for exemption. Submit the certificate to your vendors when making qualified purchases.

What is exempt from sales tax in Indiana?

Items like unprepared food, prescription drugs, goods for resale, and manufacturing machinery are exempt from sales tax in Indiana, depending on their purpose and use.

What items are exempt from sales tax in Indiana?

Exempt items include agricultural supplies, manufacturing equipment, resale goods, and medical devices, as outlined by Indiana’s sales tax exemption rules. Learn more about Indiana's sales tax exemption.

Does my Indiana sales tax exemption work for other states?

No, Indiana’s sales tax exemption certificate is generally valid only within Indiana. To claim exemptions in other states, you must comply with their specific exemption requirements.

Indiana Sales Tax filing

Filing Indiana sales tax requires businesses to report and remit collected taxes through the Indiana Department of Revenue’s INTIME portal. Filing frequency is determined by the business's tax liability. Accurate and timely filing ensures compliance with Indiana sales tax laws and helps avoid penalties or interest charges.

What are the Indiana sales tax filing requirements?

Businesses must file sales tax returns through the INTIME portal, reporting all taxable and exempt sales and remitting collected taxes. Filing frequency is assigned by the Indiana Department of Revenue based on tax liability.

How to change Indiana sales tax filing?

You can request a change to your sales tax filing frequency by contacting the Indiana Department of Revenue via the INTIME portal or submitting a formal written request. Approval depends on your business's tax liability and compliance history.

How much is the penalty for late filing Indiana sales tax?

Indiana imposes a late filing penalty of 10% of the unpaid tax or a minimum of $5, plus interest on the overdue amount.

How often do you file sales tax in Indiana?

Filing frequency in Indiana—monthly, quarterly, or annually—is determined by the amount of sales tax a business collects, with higher liability requiring more frequent filings.

Indiana Sales Tax Due Date​

Filing Frequency	Due Date
Monthly	Every 20th of the following month (Ex. Due date for January is February 20)
Quarterly	Every 20th of the month following the quarter’s end. (Ex. Due date for Q1 (January 1 – March 31) is April 20)
Annually	January 20 of the following year.

What day is Indiana sales tax due?

Indiana sales tax returns are typically due on the 20th of the month following the end of the reporting period (monthly, quarterly, or annually).

What is the penalty for filing sales tax late in Indiana?

Indiana imposes a late filing penalty of 10% of the unpaid tax or a minimum of $5, plus daily interest on the overdue amount.

Indiana Sales Tax Revenue Service

For any concerns about Indiana sales tax registration, filing or general inquiries, you can reach out to them through the following:

• Customer Service: 317-232-2240
• INTIME: https://intime.dor.in.gov/eServices/_/
• Facebook: https://www.facebook.com/INRevenue
• X: https://www.twitter.com/INRevenue
• Instagram: http://www.instagram.com/inrevenue
• Operating Hours: 8 a.m. to 4:30 p.m., Monday through Friday.

You now have the tools to navigate Indiana sales tax confidently. For hassle-free compliance, explore Kintsugi— one of the most popular sales tax automation tools in the market. Sign up or schedule a demo today.