Sales Tax and Operating an Online Business from California

Sales Tax and Operating an Online Business from California

As the owner of an online business, you know that there’s an endless amount of work to do. From ensuring your inventory is well-stocked to marketing your product or service, there’s always work to be done. However, before you can open your online store to the public, it’s important that you have the necessary seller’s permits to do business.

Ask yourself “Do I need a seller’s permit to sell online?” Then, here’s all of the information you need to know about legally conducting online sales in California.

Online Sales Tax in California

We’re all familiar with the sales tax that we have to pay when purchasing goods and items in a store. As an online business, there are also tax requirements that you’ll need to be aware of. Once you’re ready to sell products through your online store, it’s important that you’re aware of California sales tax laws, as well as other state tax liability.

Even if your business doesn’t have a physical location, you’re still required to charge and collect sales tax on all purchases, including those in and outside of California. Because you provide tangible items to customers, you’re liable to pay sales tax.

However, there are non-taxable items to be aware of. Items that don’t require sales tax to be paid include:

  • Cold food products
  • Resale items
  • Electronically transmitted items (i.e., software, digital media, etc.)

If you sell any of these items, you don’t have to worry about collecting or paying California state tax.

Why You Need a Seller’s Permit

Another must-do before you can open your business’s e-doors is to obtain a seller’s permit. Having a seller’s permit is what allows you to legally sell items at a retail or wholesale level. To obtain a seller’s permit, you’ll need to register your business with the California State Board of Equalization (BOE).

Once you have a seller’s permit, you can then issue resale certificates to any of your suppliers. This allows you to purchase items without having to pay California taxes or other state taxes, depending on the location of the supplier.

Why You Need a Seller’s Permit

How to Obtain a Seller’s Permit

If you’ve yet to register your company with the California BOE, the good news is that the process isn’t too tedious. To register and apply for a seller’s permit, you can use the online electronic registration process or you can visit a local BOE office. Once registered, you can start setting up the process to charge and pay California taxes online.

During registration, you’ll be required to provide information, such as:

  • Business name
  • Bank account details
  • Sales estimates

Looking for an even more convenient way to apply for a seller’s permit? If so, our service at FastFilings is exactly what you need.

Seller’s Permits Made Easy

As an online business owner, we understand that your schedule is always busy. To help get your business ready for online sales, you can use our service to quickly and conveniently apply for a seller’s permit. With just a few clicks, your information is sent over to BOE for review and approval.

Learn more about our business filing services by looking through our website.

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