Is the Business Tax the same as the Franchise & Excise tax?

No. The Business Tax is a gross-receipts tax on sales. The Franchise & Excise tax is a separate tax of 6.5% on net earnings plus 0.25% on net worth. Many businesses owe both.

Why might I file two Business Tax returns?

The tax has county and city components. A business located inside an incorporated city files for both jurisdictions, each tested against the $100,000 threshold.

What's the smallest Business Tax I could owe?

$22. If your gross sales are at or above $100,000 but the computed tax is less than $22, the $22 minimum applies.

Tennessee Business Tax: Rates & Filing

Tennessee has no personal income tax on wages and no corporate income tax in the usual sense. It does levy two business taxes that touch gross activity: the Business Tax (a gross-receipts tax on sales) and the separate Franchise & Excise tax. This calculator covers the Business Tax.

The Business Tax is low-rate (a fraction of a percent) but broad. It has both a state and a municipal component, and the rate depends on your classification and whether you sell mostly at retail or wholesale.

Last reviewed June 2026Verified against the Tennessee Department of Revenue’s published guidance for the 2025 tax year.

Estimate your Tennessee Business Tax in under a minute.

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Key numbers

$100,000

Filing threshold

Per jurisdiction

$3,000

Minimal activity license

0.02%–0.1875%

Rate range

$22

Minimum tax

0.1%

Class 4 (services)

Who owes it

Businesses with $100,000 or more of gross sales per jurisdiction must register for and file the Business Tax (threshold raised from $10,000 by the 2023 Tennessee Works Act).
Businesses with $3,000–$100,000 in sales need only a minimal activity license (no return).
A business inside a city files both a county and a city return — the $100,000 threshold is measured per jurisdiction.

How the tax is calculated

1Determine each location's dominant classification (Class 1–5).
2Within Classes 1–3, determine if you're a retailer (≥50% retail sales) or wholesaler — they carry different rates.
3Multiply taxable gross sales by the classification rate.
4If the result is below $22, the $22 minimum tax applies.

What's excluded from the base

Sales tax collected, returns and refunds
Certain sales to other dealers and interstate sales
Below $100,000 per jurisdiction: no return (minimal activity license only)

Deadlines & filing

ReturnApril 15

FrequencyAnnual

FilingTNTAP (online)

Tennessee Business Tax Return

Form BUS 428 (filed via TNTAP)

Annual (per jurisdiction). Due April 15 (15th day of the 4th month after year-end).

Official form / filing portal Step-by-step: how to file the Tennessee Business Tax

Recent changes

2023 (Tennessee Works Act): the filing threshold rose from $10,000 to $100,000 per jurisdiction.
2024: the franchise tax's alternative property measure was repealed (franchise tax is now net-worth only).

Frequently asked questions

Sources

Administered by Tennessee Department of Revenue. Informational only — not tax advice.