South Dakota Sales Tax Guide 2025: Standards, Rules, Rates

This South Dakota sales tax guide offers a comprehensive look at the state’s tax laws, covering rates, exemptions, and filing processes. Rely on this guide to help your business stay compliant with South Dakota's tax regulations.

South Dakota Sales Tax

South Dakota's sales tax law, established in 1935, is a cornerstone of the state's tax system. Sales tax in South Dakota covers goods and services, with sales and use tax regulations managed by the South Dakota Department of Revenue.

South Dakota Sales Tax Rate

Jurisdiction	Sales tax rate
State tax	4.5%
Local tax	0.0%–2.0%
Combined Tax	4.5%–6.5%

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

South Dakota Sales Tax Calculator

A South Dakota sales tax calculator helps retailers determine the correct sales tax on transactions based on the applicable state, municipal, and special taxes. South Dakota has a base state sales tax rate of 4.2%, and additional local taxes may apply, varying by municipality or special tax district.

Example: Imagine a retailer in Sioux Falls, South Dakota, selling a product priced at $100. Sioux Falls has an additional municipal tax of 2%.

1. Base State Sales Tax (4.2%): $100 × 0.042 = $4.20
2. Municipal Tax (2%): $100 × 0.02 = $2.00
3. Total Sales Tax: $4.20 + $2.00 = $6.20
4. Total Price (with tax): $100 + $6.20 = $106.20

Using a South Dakota sales tax calculator simplifies this process by automatically applying state and local rates based on the retailer's location, ensuring compliance with the South Dakota Department of Revenue requirements.

FAQs on Sales Tax

When did the SD sales tax rate change?

The South Dakota sales tax rate changed to 4.2% on July 1, 2023, following legislative updates.

What is the sales tax rate in South Dakota?

The state sales tax rate in South Dakota is 4.2%, with additional local taxes varying by jurisdiction.

How to calculate sales tax in South Dakota?

Multiply the item's price by the total sales tax rate (state and local) to calculate sales tax, e.g., $100 × 0.06 (6%) = $6. See the sales tax calculator section above for a more detailed example.

How much is sales tax in South Dakota?

The base state sales tax is 4.2%, but the total rate can vary due to local taxes, typically ranging from 4.2% to 6%.

What is not taxed in South Dakota?

South Dakota does not tax most groceries, prescription drugs, and certain medical devices.

Do you pay sales tax on vehicles in South Dakota?

Yes, vehicles are subject to a 4% excise tax instead of the standard sales tax.

Is South Dakota a tax-friendly state?

Yes, South Dakota is considered tax-friendly, with no personal income tax and relatively low sales tax rates.

Sales Tax Nexus in South Dakota

Type of Nexus	Threshold
Physical presence	Any physical presence
Economic nexus	$100,000 in gross sales
Marketplace nexus	$100,000 in gross sales

FAQs on Sales Tax Nexus

What is the sales tax nexus in South Dakota?

Sales tax nexus in South Dakota refers to the connection a business has with the state, requiring it to collect and remit sales tax, typically triggered by physical presence or economic activity.

What is the sales tax nexus threshold in South Dakota?

The economic nexus threshold in South Dakota is $100,000 in sales or 200 separate transactions delivered into the state annually.

South Dakota Sales Tax Exemptions

South Dakota offers sales tax exemptions on items like groceries, prescription drugs, and certain agricultural products. Nonprofits, government entities, and specific industries may also qualify for exemptions if proper documentation is provided.

Businesses claiming exemptions must ensure they meet eligibility requirements and accurately report them when filed in sales tax returns. Proper record-keeping is crucial to avoid compliance issues.

Learn more about South Dakota sales tax exemption.

FAQs on Sales Tax Exemptions

How to obtain a sales tax exemption certificate in South Dakota?

Businesses or organizations can obtain a sales tax exemption certificate by applying through the South Dakota Department of Revenue and providing proof of eligibility.

What services qualify for South Dakota sales tax exemption?

Certain services like medical, educational, and government services are exempt from sales tax in South Dakota. Learn more about what services are exempt from sales tax in South Dakota.

Is SaaS taxable in South Dakota?

Yes, SaaS (Software as a Service) is generally taxable in South Dakota as it is considered a tangible digital service.

What you need to know about sales tax on digital products in South Dakota?

Digital products, including music, movies, and e-books, are taxable in South Dakota unless specifically exempted by law. Learn more about sales tax on digital products South Dakota.

Does South Dakota have sales tax on clothing?

Yes, South Dakota applies sales tax to clothing purchases.

Are non-profits sales tax exempt in South Dakota?

Some non-profits are sales tax-exempt in South Dakota, but they must apply for and obtain an exemption certificate to qualify.

Are schools exempt from sales tax in South Dakota?

Public schools are generally exempt from sales tax in South Dakota for qualifying purchases.

Who is exempt from South Dakota sales tax?

Exempt entities include government agencies, some non-profits, educational institutions, and certain agricultural producers.

What items are exempt from South Dakota sales tax?

Exempt items include prescription drugs, groceries, medical devices, and certain agricultural supplies.

What's the South Dakota Sales Tax Registration Process

Registering for a sales tax permit in South Dakota is essential for businesses engaged in taxable sales. Below are the steps to complete the registration process in compliance with South Dakota’s tax policy.

Determine Your Obligation: Verify if your business meets the economic or physical nexus thresholds in South Dakota, such as annual sales exceeding $100,000 or 200 transactions.

Visit the South Dakota Department of Revenue Website: Go to the official website and navigate to the South Dakota Tax Application portal.

Create an Account: Register your business account by providing essential information, including your business name, type, federal EIN, and contact details.

Complete the Online Application: Fill out the sales tax registration form, including details like the nature of your business, expected sales volume, and whether sales tax will be filed monthly, quarterly, or annually.

Submit Required Documents: Upload any necessary documentation, such as proof of business registration, to complete the application.

Pay Any Applicable Fees: While South Dakota generally does not charge a registration fee for sales tax, confirm this during the process.

Receive Your Tax License: Since approved, you’ll receive your South Dakota sales tax license, which allows you to collect and remit sales tax.

Begin Collecting and Remitting Sales Tax: Start collecting sales tax on taxable transactions and ensure timely returns are filed as per the frequency assigned (monthly, quarterly, or annually).

File Sales Tax Returns: File sales tax returns through the South Dakota Department of Revenue’s online portal by the due date to avoid penalties. Be sure to report accurate taxable and non-taxable sales.

Maintain Records: Keep detailed records of sales, exemptions, and filed returns to ensure compliance with South Dakota sales tax laws.

South Dakota Sales Tax Filing

South Dakota sales tax filing requires businesses to report and remit collected sales tax to the South Dakota Department of Revenue based on their assigned filing frequency (monthly, quarterly, or annually). Businesses must calculate taxable sales, account for exemptions, and file accurate returns by the due date.

Filing is done through the state’s online portal, where businesses must ensure all required information and payments are submitted. Maintaining accurate records is essential for compliance and smooth filing.

What are the South Dakota sales tax filing requirements?

Businesses must report all taxable and exempt sales, remit collected sales tax, and file returns through the South Dakota Department of Revenue based on their assigned filing frequency.

How do I file sales tax in South Dakota?

Sales tax is filed online via the South Dakota Department of Revenue’s portal by entering sales data, exemptions, and payment information, then submitting the return by the due date.

How often do I need to file sales tax in South Dakota?

Filing frequency depends on the business's sales volume and is typically monthly, quarterly, or annually, as determined by the Department of Revenue.

South Dakota Sales Tax Due Date​

Filing Frequency	Due Date
Monthly	Every 20th day of the month(Ex. Due date for January is February 20)
Quarterly	Last day of the month following the quarter’s end. (Ex. Due date for Q1 (January 1 – March 31) is April 30)
Annually	January 31 of the following year

What is the date of South Dakota sales tax due?

South Dakota sales tax is generally due on the 20th day of the month following the reporting period, unless it falls on a weekend or holiday, in which case it’s due the next business day.

What is the penalty for filing sales tax late in South Dakota?

Late filings incur a penalty of 10% of the tax due or a minimum of $10, whichever is greater, plus additional interest on the unpaid balance.

South Dakota Sales Tax Revenue Service

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

• Phone: 1.800.829.9188
• Virtual Office Visit: Schedule an appointment
• Business Hours: Monday thru Friday 8:00-5:00 PM CST

With this guide, managing South Dakota sales tax is easier than ever. However, if you do not want to deal with the complexities let Kintsugi handle the details.  Sign up or book a demo now.