Use tax is the tax you pay when Connecticut sales tax is not paid to a retailer. The use tax is complementary to the sales tax. Together, the sales and use taxes act to tax Connecticut purchasers equally whether they purchase goods and services within or without Connecticut.

On what kinds of goods or services must I pay use tax?

You must pay use tax on nonexempt tangible personal property, whether purchased or leased. Examples of taxable tangible personal property include items of clothing and footwear costing $50 or more, automobiles, appliances, furniture, jewelry, cameras, VCRs, computers, and computer software. Some taxable services include repair services to your television, motor vehicle or computer; landscaping services for your home; or reupholstering services for your household furniture.

Are there exemptions from the use tax?

Yes. Some examples are items of clothing and footwear that cost less than $50 or repair and maintenance services to vessels.

Do I owe Connecticut use tax on all my out-of-state purchases of taxable goods and services?

No. If all the items purchased and brought into Connecticut at one time total $25 or less, you do not have to pay Connecticut use tax. The $25 exemption does not apply to items shipped or mailed to you.

What is the use tax rate?

In general, the use tax rate for purchases of taxable goods or services is 6%. However, the tax on computer and data processing services is 1%.

What if I buy taxable goods or services in another state and the vendor charges sales tax for the other state?

If the goods or services were purchased for use in Connecticut and the tax due and paid to the other state is less than the Connecticut tax, you must report and pay the difference between the Connecticut tax and the tax paid to the other state. If the tax paid to the other state is equal to or more than the Connecticut tax, you owe no use tax to Connecticut.

Example: You purchased a $1,000 refrigerator in another state, and paid $50 tax to that state. If you bought the refrigerator for use in Connecticut, you owe Connecticut use tax. The Connecticut tax of $60 ($1,000 X 6%) is reduced to $10, after allowing $50 credit for the tax paid to the other state. If no tax was paid to the other state, the Connecticut use tax is $60.

When must individuals pay the use tax?

You must file your Connecticut income tax return by April 15 for the preceding calendar year. If you are not required to file a Connecticut income tax return, you must pay the use tax using Form OP-186. You must file Form OP-186 by April 15 for any use tax liability in the preceding calendar year. You may file Form OP-186 for the entire year or you may file several returns throughout the year.

What are the penalties and interest for not paying the use tax?

The penalty is 10% of the tax due. Interest is charged at the rate of 1% per month from the due date of the tax return. There are also criminal sanctions for willful failure to file a tax return.

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