If you are a business owner in the state of Utah, and you make sales that are subject to sales tax, then you must have a sales tax permit. In addition, if your business sells goods or services to other businesses for resale, then you may be exempt from paying sales tax on these items. This is where the Resale Sales Tax Exemption Certificate comes into play.
A Resale Sales Tax Exemption Certificate allows a business to purchase goods or services without being charged sales tax. The liability for any applicable taxes falls on the reseller, not the supplier. There are two ways to share a reseller’s certificate: by submitting an existing certificate to the supplier or by creating a new certificate through third-party platforms such as Avalara, Tax-exempt, etc.
Sales tax rate – 4.850%
Information required to register for a sales tax permit in the state of Utah
1) Personal identification info (SSN, address, etc.)
2) Business identification info (EIN, address, etc.)
3) Business entity type
4) Date you’ll start selling in Utah
5) An estimate of your annual net sales and purchases subject to Utah sales and use tax
Certain purchases and rentals can be made without the need to pay sales tax. Some examples are nails, fabric, and wood incorporated into a chair; items which will be rented out as real property or tangible personal property; and services that will be resold.
You may have to report any use taxes if you resell an item you purchased. Similar to sales taxes, use taxes apply when merchandise is brought into your state and used there.
The purchaser does not need to circle one of the bullet points on the form in order for it to be valid- simply filling out and signing the form is enough. Keep in mind though that the address on the certificate does not need to match up with your company’s location address; it just needs to have your proper business name listed and be current.
The initial certificate will suffice as long as all information is correct. There’s no need for you to send multiple copies. So if you’re looking to get a resale sales tax exemption certificate, make sure to keep these things in mind!
If a reseller certificate is submitted by the business, supplier, or the provider of the service or goods, is authorized not the charge any sales tax, and the liability of sales tax, then lies with the re-seller, based on the value of the final sales. Ex. $100 worth of products are sold by business A. The reseller certificate (2A) was submitted by reseller b (2A). No sales tax is charged on this transaction. However, if the reseller sells the product for $200 or more, the $200 sales tax will be added to the final sales.
You have two options to share a reseller’s certification by the reseller. Either submit an existing reseller certificate or create a reseller certificate through third-party platforms like Avalara, Tax exempt, etc.
The supplier is the owner of the certificate. All steps must be taken to ensure the certificate remains valid.
Utah ( YOO-tah, YOO-taw) is a state in the Mountain West subregion of the Western United States. Utah is a landlocked U.S. state bordered to its east by Colorado, to its northeast by Wyoming, to its north by Idaho, to its south by Arizona, and to its west by Nevada. Utah also touches a corner of New Mexico in the southeast. Of the fifty U.S. states, Utah is the 13th-largest by area; with a population over three million, it is the 30th-most-populous and 11th-least-densely populated. Urban development is mostly concentrated in two areas: the Wasatch Front in the north-central part of the state, which is home to roughly two-thirds of the population and includes the capital city, Salt Lake City; and Washington County in the southwest, with more than 180,000 residents. Most of the western half of Utah lies in the Great Basin.
Utah has been inhabited for thousands of years by various indigenous groups such as the ancient Puebloans, Navajo and Ute. The Spanish were the first Europeans to arrive in the mid-16th century, though the region’s difficult geography and harsh climate made it a peripheral part of New Spain and later Mexico. Even while it was Mexican territory, many of Utah’s earliest settlers were American, particularly Mormons fleeing marginalization and persecution from the United States. Following the Mexican–American War in 1848, the region was annexed by the U.S., becoming part of the Utah Territory, which included what is now Colorado and Nevada. Disputes between the dominant Mormon community and the federal government delayed Utah’s admission as a state; only after the outlawing of polygamy was it admitted in 1896 as the 45th.Source