What the Form Is For
Form 01-114, officially titled the "Texas Sales and Use Tax Return," is the long-form version of the regular tax filing that businesses use to report and pay the sales tax they've collected from customers. Think of it as your monthly or quarterly report card to the Texas Comptroller of Public Accounts, showing all the taxable sales your business made and calculating how much sales tax you owe the state.
This isn't the form you use when first starting your business—that's the permit application (Form AP-201). Instead, Form 01-114 is what you'll file repeatedly throughout the year once you're up and running with an active sales tax permit. The form captures the total amount of your sales, breaks down what portion was taxable, calculates the tax due at the appropriate rates (which vary by location in Texas), and accounts for any credits or adjustments you're entitled to claim.
You must use the long-form version (01-114) rather than the short form (01-117) if your business has multiple locations, reports tax to more than one city or transit authority, needs to claim credits or refunds, or is responsible for reporting out-of-state purchases subject to use tax. Businesses with simpler operations—single locations with straightforward sales to one taxing jurisdiction—may qualify to use the shorter version instead.
When You’d Use It (Regular, Late, and Amended Filings)
The timing and frequency of filing Form 01-114 depends on how much sales tax your business paid during the previous state fiscal year, which runs from September 1 through August 31. The Texas Comptroller assigns you a filing frequency when you first receive your permit and notifies you by letter whether you'll file monthly or quarterly.
Filing Frequency
Monthly filers must submit Form 01-114 by the 20th day of the month following each calendar month. For example, your January sales tax return covering January activity is due by February 20.
Quarterly filers report their sales every three months, with returns due on:
- April 20 (covering January through March)
- July 20 (April through June)
- October 20 (July through September)
- January 20 (covering the prior year's October through December)
Late Filings and Penalties
If you miss a deadline, you're filing late, and penalties begin immediately.
- $50 late filing penalty applies to each report filed after the due date
- 1–30 days late: 5% penalty on the tax amount
- Over 30 days late: 10% penalty
- Interest begins accruing after 61 days (8.50% for 2025)
Amended Returns
Amended returns are filed when you discover errors on a previously submitted return—whether you overpaid or underpaid.
- Make corrections on a copy of your original return or complete a new form
- Write "Amended Return" prominently at the top
- Sign and date the form
- Mail to the Comptroller's office or file electronically
Even when you have zero sales, you must still file a return using the "NO SALES" designation or Telefile.
Key Rules and Requirements
Electronic Filing Requirements
- $50,000+ in sales tax: electronic filing required
- $100,000+: electronic payment required
- $500,000+: must use TEXNET
- Failure to comply: additional 5% penalty
Tax Calculation Rules
- State rate: 6.25%
- Local tax: up to 2%
- Maximum combined rate: 8.25%
Businesses operating in multiple locations must track and report sales separately for each jurisdiction.
Required Attachments
- Form 01-115: Outlet Supplement (multiple locations)
- Form 01-116: List Supplement (multiple jurisdictions)
Failure to include required forms may result in delays or rejection.
Credits and Refunds
- Must check "yes" in Item j
- Must use long form
- Reduce taxable sales accordingly
Bad debt credits require electronic filing.
Prepayment Discounts
- 1.25% prepayment discount
- 0.5% timely filing discount
- Must prepay by the 15th
- Must meet “reasonable estimate” rules
Step-by-Step (High Level)
Step 1: Identify Business Information
Provide taxpayer number, permit number, business name, and reporting period.
Step 2: Calculate Total Sales (Item 1)
Enter total sales excluding collected sales tax.
Step 3: Report Taxable Sales (Item 2)
Subtract non-taxable sales to determine taxable sales.
Step 4: Calculate State Tax (Item 3)
Multiply taxable sales by 6.25%.
Step 5: Calculate Local Taxes
Apply appropriate local tax rates per jurisdiction.
Step 6: Account for Use Tax
Report out-of-state purchases not taxed at purchase.
Step 7: Apply Credits and Adjustments
Include refunds, bad debts, and prior credits.
Step 8: Calculate Net Amount Due
Combine taxes, subtract credits, apply discounts.
Step 9: Sign and Submit
Sign under penalty of perjury and submit electronically or by mail.
Common Mistakes and How to Avoid Them
Including Sales Tax in Sales Figures
Only report selling price, not collected tax.
Using the Wrong Tax Rate
Verify rates using the Comptroller's Tax Rate Locator.
Failing to File With No Sales
Always file, even with zero activity.
Not Attaching Required Supplements
Include Form 01-115 and/or 01-116 when applicable.
Claiming Credits Without Documentation
Maintain records proving eligibility.
Missing Electronic Filing Requirements
Follow thresholds to avoid penalties.
Ignoring Amended Return Procedures
Properly label and submit amended returns.
What Happens After You File
Timely Filing With Full Payment
Return is processed and account remains in good standing.
Late Filing or Payment
Penalties, interest, and possible enforcement actions apply.
Overpayment and Refund Claims
File Form 00-957 or apply credit to future returns.
Audit Selection
May occur randomly or based on risk factors.
Account Maintenance
Keep business information updated and remain compliant.
FAQs
Can I file Form 01-114 electronically, and is it required for everyone?
Yes, electronic filing is required for businesses that paid $50,000 or more in sales tax during the previous fiscal year.
What's the difference between sales tax and use tax?
Sales tax is collected from customers; use tax applies to untaxed out-of-state purchases.
How do I know which local tax rates to charge?
Use the Comptroller's Tax Rate Locator and track jurisdiction-specific sales.
What happens if I make an error after filing?
Submit an amended return with corrections.
Am I eligible for the prepayment discount?
Yes, if you meet the prepayment threshold and timing requirements.
Can I set up a payment plan?
Yes, the Comptroller may allow payment plans depending on your situation.
Do I need to keep records?
Yes, maintain records for at least four years.
