How to Get a Seller's Permit (Video)

by Joshua Botello 

A Sales Tax Permit or seller’s permit is a requirement in California for retailers if you sell a physical product in the state of California. Is that all, you say? California also requires a seller’s permit if you have inventory stored in California, have employees like independent salespeople in California, or if you have a website that sells products in California. So, now that we have that out of the way let's hop on to the computer and get into the application for filing that seller’s permit.

Finding the Application

Here we are on the desktop, and we are going to head to our browser and type in CDTFA.CA.GOV to get to the California Department of Tax and Fee Administration. So now that we are on the home page we need to navigate to the actual application. So we head to this register button, just below the header and click register. Now we have to go down about halfway down the page to “Register or Apply for a New..” and then Click business activity or location. Now we are at the online services home page. If you have an existing account and login you would do that here, but we want to register so we go down to register a new business activity.

Starting the Application

We finally made it to start the application. This first page is going to ask what kind of business you are registering. These are all the instances the state of California requires sales tax to be added and paid to the state. We are just a small retail business so all we have to do is choose selling items or goods in California to begin. Then we click Next. So now, we need to answer a few questions about what we are selling. If, none of this stuff applies to us we will click No and click Next. Here are more questions about what we are selling. Again, none of this stuff applies to us, but if it does to your business click yes and continue. Then click Next.

Choosing your Business Type

Here we need to list our business type. If you saw our previous videos on registering as a DBA or LLC, you will list that structure here. If it is a different structure, choose that from the list then click Next.

Here we are at the taxpayer information. Since you are an individual, you will put your SSN first. Next is the EIN, if you don’t have one stop right here. Check out my video on how to file for an EIN and then come back so we can continue. If you have that number input it in the FEIN space. If you are a foreign or international seller you will need to get some consulting help and contact us to help with that situation. We will also put a driver’s license number to verify.

Since I am registering in and from California we can pick California and choose whether or not we are switching from another business entity type. We are not so click No and then Next.

Open your Permit Account

The application is going to ask if we have a current account. This is to make sure we didn't forget we had an account and are trying to re-register. We don’t have a current account. Choose No and then Next. Now you will find a little summary and unfortunately, this isn't the end. It is just having you review what permits you are applying for and confirming. We are definitely doing the Seller’s permit. If you have other permits you are applying for you would confirm those as well. So click yes and Next. So, this is an interesting question: a temporary permit. This is for popup shops and temporary stores like at fairs or something. We are planning to do business for a lot longer than 90 days. So choose No. Then Next.

Enter Your Business Information

Here we are entering some information again. This form is for the address of your business. If you have a physical address for your business you can enter here or for an e-commerce store and then choose, if this is the business location or if it is just a mailing or administrative address. Let’s fill all this out and then we can choose Next.

Enter Owner Information

This question is asking what the relationship you have as the applicant to the business. If you are a sole proprietor we choose that and the entity type. So Choose “individual” and then Next. Now we put in owner information. So let’s add it in here and when we are done click Next. Here is some more information for the individual applying. Here is where you put all owner information. We will put in dummy numbers for rest for this demonstration. Then Click Next. This page will ask if the address we supplied will be used for records, like accounting, and for contacting the owner. Yes to both for us, and click Next. 

Online and Credit Sales

Here are two interesting questions. If you will be taking credit you will need to put your processor and account information. Likewise, if you are taking web sales for an e-commerce site you need to put that information and if it’s a third-party processor like stripe. We won’t this time, so no for both and click Next.

Business Category

The form will ask you for a Naics code. Choose one for your business. We can find one online by doing a google search but since I know mine, ill input it, make sure it's right and Next. The form will ask you about certain products. If you click yes, it will determine that you need to tax certain items besides what you are applying for. Otherwise, we click no and Next.

Temporary Permit Address

Remember that temporary permit question at the very beginning? This is where it comes into play. If you click yes then you will enter in your temporary location information and rent. We are going to be a permanent location so click No and Next. We will put in the basic information for the address and then make sure the address is or is not the location of the business address. then click next. Here is where our DBA information will go in case you were wondering and we’ll put the phone number of the business location. Then Next

Set up your Sales Date 

It’s asking when we plan to start selling. We need to make it in the future so we don't have to pay taxes now because we haven’t made any sales now. The state of California is also asking if we are purchasing or transferring a business. In this case No. Click Next. We will verify our address click next.

On this page, you are going to choose when you will be starting to sell. If you choose a date in the future it needs to have enough time for you to produce sales for the next quarterly filing. 

Estimate Taxable Sales 

You will also need to enter your estimated sales of the business. The next section is the taxable sales. If you sell non-taxable items you will need to enter how much of that you plan to sell. Since all of my products will be charged sales tax we will keep it the same. You will also need to agree on whether or not your sales could be zero. If you do you can operate on a loss and not pay any tax. We will always sell something so I’ll put NO on both. Then enter in a description of what products we are selling. It doesn’t need to be super precise. Then click next.

Confirm Address Information

You will need to click on both addresses to proceed. One will be for your records address if you don't have an accountant and the other is a mailing address. Then Next. California requires that you input at least one supplier who you do business with. I'm just going to enter a dummy name to proceed to the next section.

Home Stretch

Here we are at the registration summary. Choose quarterly as the reporting since it is the standard. Once we review all the information we have entered. Click yes to agree and next. On this page you will need to enter in your information if you are preparing this application yourself or the preparer will input their own information. Then click Next. This is the last page. Once you check the box and click next. Your seller's permit will be filed. 

Remember, you will need to get a permit if you sell a physical product or are taxed by the state of California in certain instances. You can always schedule to meet with your SBDC consultant to find out what permits and licenses you will need for your particular business type. 

Funded in part, through a Cooperative Agreement with the U.S. Small Business Administration. All opinions, conclusions, and/or recommendations expressed herein are those of the author(s) and do not necessarily reflect the views of the SBA.