Key figures
Rhode Island receivables
2026, with sources
SaaS at 7%
Rhode Island has one statewide sales tax rate, 7%, and since October 1, 2018 it has applied it to vendor-hosted prewritten software. The Division of Taxation’s later rulings read that broadly: infrastructure, platform and software as a service are all taxable when a Rhode Island customer is charged, whether access is permanent or temporary. An older regulation that exempted hosted software with nothing downloaded no longer applies.
With no local rates, a startup billing Rhode Island customers charges 7% everywhere in the state.
When collection starts
Rhode Island’s remote seller law covers sellers that, in the immediately preceding calendar year, had $100,000 or more of gross revenue from tangible property, electronically delivered prewritten software and taxable services delivered into the state, or 200 or more separate transactions. Either test is enough, so a low-priced self-serve product can cross the line on transaction count alone.
The test looks back at the prior calendar year, so a company that crosses it in 2026 starts collecting in 2027, unless it already has a physical presence, such as an employee in the state, which creates nexus on its own.
Credits and refunds
Customer prepayments, credits and uncashed refund checks that go unclaimed are reportable to the General Treasurer as unclaimed property in the annual report due before November 1, as of June 30.
Deadlines
- Per assigned scheduleSales and use tax return, on the frequency the Division assigns
The federal baseline
This page covers what Rhode Island adds. The federal rules underneath it apply here too.
Common questions
Is SaaS taxable in Rhode Island?
Yes. The Division of Taxation has applied the 7% sales and use tax to vendor-hosted prewritten software, sometimes called SaaS, since October 1, 2018, and later rulings say IaaS, PaaS and SaaS are taxable whenever there is a charge to a Rhode Island customer, whether access is permanent or temporary.
Do we need both $100,000 and 200 sales?
Either test is enough. A remote seller that in the prior calendar year had $100,000 of sales delivered into Rhode Island, or 200 or more separate transactions, must comply. A self-serve product with 220 Rhode Island subscribers at $20 a month is over the transaction test with only $52,800 of revenue.
Receivables next door
- CTConnecticut receivablesConnecticut charges 6.35% with no local rates, but SaaS and software sold to businesses are 1%. Remote sellers register at $100,000 and 200 sales in a year.
- MAMassachusetts receivablesMassachusetts taxes most SaaS as prewritten software at 6.25%, with no local rates. Remote sellers register once Massachusetts sales exceed $100,000; there is no transaction count.
Founder guides on this
- Sales taxSales tax nexus for startups: when you owe tax in a stateSince Wayfair, selling into a state can create a sales tax obligation. How economic nexus works, why SaaS is taxable in some states and when to register.
- RevenueDeferred revenue for SaaS startups, explainedAn annual prepayment is cash today and revenue over a year. How deferred revenue works under ASC 606, why it’s a liability, and the schedule behind it.
- StripeHow to reconcile Stripe payouts to your booksA Stripe payout is charges less fees, refunds and disputes, batched across days. How to book it gross, tie it to the bank, and keep revenue right.
More of the Rhode Island guide
- AccountingAccounting and state tax in Rhode IslandCorporate tax, conformity to federal rules, apportionment and what it does to your books
- PayablesPayables and contractors in Rhode IslandPaying vendors and contractors: 1099 filing, use tax, contractor tests and withholding
- PayrollPayroll taxes and employer rules in Rhode IslandWithholding, unemployment insurance, paid leave, minimum wage and the rules on paydays
- ComplianceCompliance and filings in Rhode IslandRegistering to do business, annual reports, franchise tax and the filing calendar
- AdvisoryAdvisory: credits and decisions in Rhode IslandCredits, incentives and the decisions that are cheaper to get right the first time
Sources
Checked against each agency’s own page on . Rates and thresholds change, usually on January 1.
General information for US companies, not tax, legal or accounting advice for yours. Rules and thresholds change; confirm the specifics with a CPA or the agency before you act on them.