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Prepared By: Melissa C. Marsh, Los Angeles Business Attorney
Written: March 2009

Note: For a list of the sales and use tax rates for each county, please visit the California State Board of Equalization.

Who Needs a California Seller's Permit, also commonly referred to as a Sales Permit?
If your California business, corporation, or limited liability company (LLC) will provide, sell or lease any taxable taxable good, product or service, your business must apply for a California Seller's Permit for each business location before engaging in any sales subject to sales tax. Each location where sales of taxable items are made requires, and must display, a valid California seller’s permit. Consequently, a separate California sales permit is required for each location where sales of taxable items will be made.

Although California presently does not charge a fee to issue a California seller's permit, the State Board of Equalization may require the business to post a security deposit.

To obtain a California Seller's Permit, the California business, corporation, or limited liability company (LLC) must complete and file a California's Seller's Permit Application with the California State Board Of Equalization. If the sales will be ongoing, the business should apply for a “Regular” sales permit. If , on the other hand, the business will only engage in sales for a temporary period of time (90 days or less), then the business should only apply for a “Temporary” permit.

To apply for a California seller's permit, the business owner will need to have the following information:

1. The company's EIN, or federal taxpayer identification number (if applicable) and the social security number of each business owner, or corporate officer (if applicable);
2. A photocopy of the applicant's driver license, and if a partnership a photocopy of each partner's driver's license, and if a limited liability company, then a photocopy of each member's driver's license. For a corporation, the applicant must submit the social security number of each corporate officer;
3. The names and addresses of every bank where the company has an account;
4. The names and addresses of each of the company's suppliers;
5. The name and address of the individual who will be responsible for maintaining the company's tax records;
6. Two personal references;
7. The types of products and services to be sold;
8. Expected average monthly sales, and the amount of those sales which are or will be taxable; and
9. If you have purchased an existing business, you must also provide the previous sales permit information.

Each partner, corporate officer, and limited liability company manager/member/officer, must also provide the above information.

Typically a Seller's Permit will be issued within 14 days if the application is received by mail. It can be acquired the same day, if applied for in person.

Once a California Seller's Permit is issued, the business is required to:

1. Keep records to substantiate its sales, purchases, and return deductions for a period of four (4) years;
2. File a sales tax return, even if the business engaged in no sales, on a monthly, quarterly, or annual basis as determined by the state Board of Equalization;
3. Pay the sales tax due on all retail sales consummated in California; and
4. Notify the State Board of Equalization of any changes to the business, such as a change in ownership, address, additional location, or dissolution of the business.

If you would like the assistance of Melissa C. Marsh, a California business attorney, she can complete the form for you for a flat fee of $175. Simply call 818-849-5206 or Send us an Email.

Related Articles and Legal Services:

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Ms. Marsh provides various low cost In House Counsel Plans designed specifically for the small business owner, and if you just have a few simple questions she provides a Telephone Consultation for as little as $129.

• How to Get a Fictitious Business Name, DBA, and When You Need to File for a DBA in California.
• How To Get A Federal Taxpayer Identification Number (EIN) for a California Business.

© 2009 Melissa C. Marsh. All Rights Reserved.