Everything You Need to Know about CA Seller's Permit

A seller's permit is a legal requirement if you are a business person in California, intend to lease or sell personal property that would normally be subject to sales tax if sold at retail (this includes retailers, wholesalers, and manufactures), or will make sales for a specified period, usually lasting no longer than 3 months at different locations (for example, garage sale, Christmas tree lots or fireworks booth)

How do you apply for a CA seller’s permit?

Today, permit applications can be completed online. Once the application is complete and submitted, you are issued with a sales tax ID or the resale certificate. A seller’s permit applies to all individuals, partnerships, corporations, and limited liability companies dealing in wholesale and retail products. Should you need to sell products for a period not exceeding 90 days, you will need to be issued with a temporary resale certificate.

In the application process, you will be required to fill in info such as; your date of birth, social security number, personal identification numbers, the address of your banker, your suppliers’ addresses, personal references, and projected monthly sales and the amount of anticipated taxes. Other information may be required, such as the corporate number for corporations.

How much do I get charged to obtain a resale certificate?

While obtaining a CA seller’s permit is free, CDTFA in some cases requires that you provide collateral for unpaid taxes that could be owed at a later date should the business close. The collateral amount will be calculated at the point of application.

I have multiple stores. Do I need multiple permits?

You may need more than one permit if you have multiple business premises. However, it is possible to obtain one permit for different business outlets provided you furnish the CDTFA with the address of each while applying. This will enable them to issue you with the correct one.

What happens in case I close the business?

A seller’s permit is only valid as long as you are actively engaging in business. Once you decide to close the business, return the permit to CDTFA for annulment. Should you fail to do this, CDTFA has the right to cancel the permit if they discover your business is no longer active.

You should also ensure that you notify them in case your business’ ownership changes. This is because the listed owners are the ones liable for incurred taxes along with their interests or penalties after the transfer. Timely notifications in business ownership changes could protect you from future liabilities.

A seller’s permit should not be confused with a business license. While CDTFA issues the former, the latter is issued by your city’s business license department. At Fast Filings, we provide hassle-free online filing services for businesses. Spend less time doing paperwork and more time making profits.