Do you want to sell or resell things in California? Then you will need a sales permit (aka Sales and Use Tax Permit in other states). You will also need a federal tax ID number, and other state and local licenses, certificates and permits if you intend to sell or lease tangible goods that would usually have sales tax. If you want to sell what other people have first sold to you, without paying those people sales tax, you need a resale permit. So, do you want to know how to get a resale permit in California?
To sell things in California,you have to follow the laws and regulations of the California Department of Tax and Fee Administration (CDTFA). You first will need a seller’s permit since the wonderful State of California wants to know who must give itsales tax. In California, a resale permitis officially called a resale certificate. It may alsobe called a wholesale license.
The format of a resale certificate is rather simple. California has a downloadable PDF certificate that canbe easily filled out. The biggest limitation of that form is how much information you can write in it. Any form couldbe used, but it must havethe following:
- The name of your supplier
- Descriptions of products you willbe purchasing for resale
- An explicit statement that the beforehand products areindeed for resale (legalese!)
- Your valid California seller’s permit number
- A general description of thetypes of things you sell
- Your printed name and signature
- Your business name and address
- Your business phone number
- A document date
- Your signature or someone else’s whois legally able to act on your behalf
- PROPER LEGAL LANGUAGE!
For repeat purchases from the same supplier, youdo not need to present a new resale certificate each time. It is the responsibility of the seller to confirm the validity of your sales permit.
If you sell items frommore than one store, for example, three different stores at three different addresses, you will need to give the supplier of your goods a resale certificate for each of your stores.
Always remember:Items purchased on a resale certificate must be resold;those things cannot be used by you or your business.
The legal language protects both you and your supplier. By making use of a legally approved form, you can avoid bad language that state and federal tax authorities could hit you with.