What the Form Is For
Texas Form 01-117, officially titled "Texas Sales and Use Tax Return – Short Form," is a simplified tax return used by businesses with a Texas sales and use tax permit to report their monthly, quarterly, or yearly sales tax collections to the Texas Comptroller of Public Accounts. This streamlined form serves businesses that have one active location and do not report local sales taxes for jurisdictions outside their primary business location.
The form captures essential information including total sales amounts, taxable sales, use tax on taxable purchases, and calculates the state and local sales tax due. Texas imposes a 6.25 percent state sales and use tax on retail sales, leases, and rentals of most goods and taxable services, with local jurisdictions adding up to 2 percent for a combined maximum rate of 8.25 percent. Form 01-117 allows single-location businesses to fulfill their statutory obligation to report and remit these taxes to the state.
Businesses with multiple active locations or those reporting local sales tax for multiple jurisdictions must instead use Form 01-114, the longer version that accommodates more complex reporting scenarios. The short form streamlines compliance for simpler business structures while maintaining the same legal requirements for accurate tax reporting.
When You’d Use It
Regular Filing Schedule
You'll use Form 01-117 according to your assigned filing frequency—monthly, quarterly, or yearly. The Comptroller's office notifies permit holders of their filing schedule after approval.
- Monthly filers: due by the 20th of the following month
- Quarterly filers: due April 20, July 20, October 20, January 20
- Yearly filers: due January 20
Zero Sales Reporting
Even during periods with no taxable sales or purchases, you must file a return. For zero activity:
- Use TeleFile (phone system)
- Or submit Form 01-117 with zero indicators
Late Returns
If you miss the deadline:
- $50 late filing penalty applies
- 1–30 days late: 5% penalty
- 30+ days late: 10% penalty
- Interest begins after 61 days
Amended Returns
To correct a previous filing:
- Mark "Amended Return" clearly
- Submit corrected form
- Include any additional tax, penalties, and interest
- Request refunds separately if overpaid
Key Rules or Details for 2025
Mandatory Filing
Holding an active permit requires filing every reporting period—even with zero sales. Failure to file may result in:
- Estimated billings
- Liens
- Permit suspension
- Criminal penalties
Electronic Filing Requirements
If you paid $50,000+ in sales/use tax during the prior fiscal year:
- Electronic filing is required
- Options: Webfile, EDI, or TeleFile
Timely Filing Discount
- 0.5% discount for filing and paying on time
- Additional 1.25% prepayment discount for qualifying filers
Record Retention
Maintain all records for at least four years, including:
- Sales invoices
- Purchase records
- Exemption certificates
- General ledgers
Step-by-Step (High Level)
Step 1: Gather Your Records
Compile:
- Total sales
- Taxable sales
- Taxable purchases without collected tax
Step 2: Complete Business Information
Verify:
- Taxpayer number
- Business name and address
- Reporting period
Step 3: Report Sales Figures
- Enter total sales
- Subtract non-taxable sales
- Report taxable sales
Step 4: Calculate Tax Due
- Multiply taxable sales by total tax rate
- Verify rate accuracy
Step 5: Report Use Tax
Report tax on:
- Out-of-state purchases
- Untaxed business-use items
Step 6: Apply Credits and Discounts
- Subtract credits
- Apply 0.5% discount if eligible
Step 7: Sign and Submit
- Sign and date
- Submit electronically or by mail
Common Mistakes and How to Avoid Them
Forgetting to File During Inactive Periods
You must file every period—even with zero sales.
Using Outdated Tax Rates
Always verify current tax rates before filing.
Incorrectly Reporting Total vs. Taxable Sales
- Total sales = all receipts
- Taxable sales = after exemptions
Missing the Use Tax Line
Review all purchases for unpaid sales tax.
Failing to Keep Adequate Records
Maintain organized documentation for audits.
Not Claiming Legitimate Discounts
Ensure you apply:
- 0.5% timely discount
- 1.25% prepayment discount (if eligible)
What Happens After You File
Processing and Confirmation
- Electronic filings receive immediate confirmation
- Paper filers are processed manually
Refunds or Additional Payments
- Overpayment → request refund
- Underpayment → billing notice issued
Routine Compliance
Your account stays in good standing with timely, accurate filing.
Potential Audit Selection
Audits may occur due to:
- Random selection
- Industry review
- Filing patterns
Collections for Delinquencies
Failure to comply may result in:
- Liens
- Asset seizure
- Permit suspension
- Legal action
FAQs
Can I file Form 01-117 if I have multiple locations?
No. This form is only for single-location businesses. Multiple locations require Form 01-114.
What’s the difference between sales tax and use tax?
Sales tax is collected at the point of sale. Use tax applies when tax was not collected, typically for out-of-state purchases.
If I file late but owe no tax, do I still face penalties?
Yes. A $50 late filing penalty applies even with zero tax due.
How do I know my filing frequency?
The Comptroller assigns it based on tax liability and notifies you after approval.
Can I take the timely filing discount on an amended return?
No. The discount only applies to original filings submitted on time.
What if I collected too much tax from customers?
You must refund customers first before requesting reimbursement from the Comptroller.
How long does a sales tax audit typically take?
It varies. Simple audits may take weeks; complex cases may take months.
