Probably one of the easiest businesses to start is one where you sell goods right out of your own home online through Amazon. One of the biggest questions people have is “Do I need a business license to sell on Amazon in California?” Setting up your online business through Amazon does require you to verify if you need a seller’s permit, business license, state sales tax number, and a taxpayer identification number (TIN).
What Is a Seller’s Permit?
A seller’s permit allows you to sell goods at wholesale and retail to other customers. You will need to obtain one in order to sell on Amazon in California.
What Is a Business License?
A business license is sometimes confused with a seller’s permit. They are not the same things. A business license is required to conduct business—sell goods—in California. Even if you do not have a physical storefront, you may still need one. Certain cities in California require a business license for home-based businesses selling goods online.
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What Is a State Sales Tax Number?
A state sales tax number is sometimes called a resale certificate. Be careful to not confuse this with a resale license. A resale license allows you to purchase items in bulk from suppliers and not have to pay sales taxes on your purchases. A resale certificate (state sales tax number) is required so you can collect and pay sales taxes on the goods you sell in California.
What Is a TIN?
A TIN is a number, much like the Social Security number the IRS uses to identify your business. While not necessarily required to conduct business on Amazon in California, it is a good idea to get one to use in place of your Social Security number to prevent identity theft and for tax purposes.
When Do I Need to Collect Sales Taxes?
You will need to collect sales taxes on any goods you sell on Amazon in California, including if you use Amazon’s Fulfillment by Amazon (FBA) service. However, if you use this service, then you will also have to collect state sales taxes in any state where Amazon offers their FBA service, such as California, Florida, Texas, Washington, and so on.
Will I Need a State Sales Tax Number for Multiple States?
If you use Amazon’s FBA service, then you will need to apply for state sales tax numbers from each state where Amazon offers their FBA service. Not having a state sales tax number in some states is considered to be illegal.
Starting a business out of your home by selling goods on Amazon in California does require you to obtain the right permits, licenses, certificates, and a TIN. It is a good idea to verify exactly which ones you need before selling on Amazon. Doing so will help avoid having your account suspended or, worse, facing potential criminal charges for not paying sales taxes in states where you were required to collect them.
For assistance in obtaining a seller’s permit and other business filing services, please feel free to contact FastFilings.com by filling out our online contact form or by phone at (415) 857-3301 today!
Apply for a California Seller's Permit!
Need help filing your seller's permit in California?
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