Any prospective business that will plan to sell a product will need to obtain a seller’s permit. When you apply for this permit through the state you live in, it can allow you to collect sales tax when you provide a service or product. Not only is it your responsibility, but the state also has to collect and report sales tax. As part of regular operation, it is a normal part of any business.
How Do I Know If My Business Needs One?
The general rule of thumb is that you always need to get a permit to sell anything, even if you feel like it’s unnecessary. Sales tax is put upon almost any service or product your business offers to consumers. In recent years, online sales have become more popular than ever. For many individuals who operate and sell products and services in the online world, it can become confusing if they need to obtain a permit. It’s a good idea to check the state you live in, but generally, it’s only collected for larger businesses that have a large number of transactions or more than $100,000 in sales annually.
What Information Do I Need To Provide?
Getting a seller’s permit to collect sales taxes from patrons will require you to provide some necessary documentation. Here are a few things you should expect to have to verify identification:
- A social security number
- Driver’s License
- Bank account information as well as the location
In many states, you could also be asked to estimate the sales you’ll have every month in addition to a description of the products you’ll be selling. You need to identify the taxable products.
What Happens Next?
You’ll need to register to get a sales tax permit, so you collect taxes from all of your customers. It’s almost always the norm to show the sales tax as a separate charge, so your customers don’t get confused, even if it’s online. In certain situations, you may be exempt from sales tax, but this differs depending on the state you live in.
Running a successful business not only takes dedication and organization, but you must also fulfill all the legalities so you can operate with peace of mind. Now that you understand a little better how sales tax and a seller’s permit go hand-in-hand- you can run your business with the confidence you deserve for years to come.
