How to Get a Seller's Permit and Resale Certificate in California
California has no separate resale license. If your business buys products to resell, you need two things: a California seller's permit from the California Department of Tax and Fee Administration (CDTFA), and a resale certificate that you give to each supplier when you buy goods for resale. The seller's permit registers you to collect sales tax from customers. The resale certificate tells your supplier why a purchase is not taxed at that point. Together, they are how most California retailers and wholesalers buy inventory.
This guide is informational content, not legal or tax advice. Rules and CDTFA procedures can change, and the CDTFA is the final authority on your filing obligations. For a complex situation, such as multiple entities, several locations, or out-of-state sales, talk to a qualified CPA or attorney before you register.
The Seller's Permit Is Not a Business License
The most common mistake new sellers make is treating the seller's permit as the license that lets them open for business. It is not. The seller's permit is a tax registration, and the CDTFA issues it free of charge. Your business may need several separate registrations and permits, depending on what you do:
- Entity registration with the California Secretary of State if you form an LLC, corporation, or other entity. The Secretary of State issues no licenses or permits, and the LLC articles fee is $70 (Form LLC-1).
- A CDTFA seller's permit if you sell taxable goods.
- EDD registration if you have employees.
- A local business tax or registration certificate from your city. Most cities charge one: 445 of 483 cities report revenue from one. The amount has no common formula, so check your city's website. Counties license only regulated activities.
- State licenses from the boards that regulate trades and professions, such as the Contractors State License Board or a Department of Consumer Affairs board.
California has no general statewide business license. For more on the local piece, see our California business license guide.
Who Needs a California Seller's Permit
Under CDTFA Publication 73 (October 2026), you need a seller's permit if you are engaged in business in California and intend to sell or lease tangible personal property that would ordinarily be taxed at retail. Wholesalers and retailers both apply. You are engaged in business in California if any of the following is true:
- You have a place of business in California.
- You have a representative in California.
- You have property in California.
- Your combined California sales of tangible personal property were above $500,000 in the preceding or current calendar year.
If your sales come from outside California, the last point matters. Our remote seller guide covers the $500,000 threshold and how it applies to online sellers in more detail.
A temporary seller's permit is available for selling operations that normally last no longer than 30 days at one location, such as a short-term event or pop-up. If you are unsure whether your activity needs a permit, check with the CDTFA before you make your first sale. This guide does not set a sales-count rule, because the answer depends on your facts.
How to Apply for a Seller's Permit
You register online with the CDTFA. The seller's permit is free, so the only cost is your time to collect the information. Have these details ready before you start:
- Social Security number
- Driver's license or state ID number
- Business contact information and a business email address
- Federal EIN
- State employer number, if you have one
- Corporate name and number, for corporations
- Names and details for partners, officers, members, or managers
- Personal references
- Supplier names and addresses
- NAICS code for your business
- Bank and merchant processor details
- The name of the person who keeps your books
If you operate from several locations, you may need a permit for each address. A consolidated permit is generally possible, so ask the CDTFA which setup fits your business. The CDTFA may also require a security deposit in some cases. Check with the CDTFA about current processing times, since this guide does not give a timeline. Start at the CDTFA sales and use tax page and the main CDTFA site.
What You Owe After You Get the Permit
Holding a seller's permit creates filing duties. You must file a sales and use tax return even in a period when your sales are zero. Returns are due the last day of the month after the reporting period closes.
The CDTFA assigns your filing basis: monthly, quarterly, quarterly prepay, fiscal annual, or annual. It requires prepayments from businesses with average taxable sales of $17,000 or more a month, and it tells you so by written notice. Keep your records for at least four years.
The statewide base sales tax rate is 7.25%. With district taxes, city rates run from 7.25% to 11.75%, so the rate you charge depends on where the sale is delivered. Our California sales tax rates guide lists how rates vary by city.
The California Resale Certificate
When you buy goods to resell, you give your supplier a resale certificate. It shows that the purchase is for resale, so the supplier does not charge you sales tax on it. People search for a california resale certificate form, but the CDTFA does not require a specific form.
A valid resale certificate can be a note, letter, or memo, as long as it includes all of the following:
- The purchaser's name and address
- The seller's permit number
- A description of the property being bought
- A statement that the property will be resold or is for resale. Words such as nontaxable or exempt are not acceptable.
- The date
- A signature
The CDTFA-230 is an optional form that includes these elements. You may use it, but you do not have to. If you use it, download the current version from the CDTFA website. If you do not have a seller's permit, you must say so on the certificate and explain why one is not required.
Using one certificate for repeat purchases
One certificate on file with a regular vendor can cover repeated purchases from that vendor. Purchase orders can also work. A purchase order may say refer to purchase order and mark the items as being for resale.
What suppliers must do
A seller who accepts a resale certificate has its own obligations. The seller must take the certificate before billing, either within the normal billing cycle or before delivery. It must not accept a certificate if it knows the purchase is not for resale, and it must keep the certificate on file. A seller can check a permit number on the CDTFA website before accepting a certificate.
Ask the CDTFA how it handles resale certificates from other states before you rely on one. This guide does not state a rule on that point.
What Goes Wrong: Penalties for Misusing a Resale Certificate
Using a resale certificate for purchases that are not actually for resale is taken seriously. Items you buy for business use rather than resale are subject to use tax, even if you gave a resale certificate. The consequences include:
| Problem | Consequence |
|---|---|
| Tax due on purchases that were not for resale | Tax plus interest |
| Misuse of the seller's permit or certificate | Possible permit revocation |
| Each purchase made for personal gain or to evade tax | Penalty of 10% of the tax or $500, whichever is greater, per purchase |
| Fraud | Penalty of 25% |
| Issuing a certificate to evade tax | Misdemeanor with a fine of $1,000 to $5,000, up to one year in county jail, or both |
If you are not sure whether a purchase qualifies for resale, ask before you buy. A tax professional can review your specific purchasing pattern.
Your Checklist for Getting Started
- Confirm with the CDTFA that your activity requires a seller's permit.
- If you formed an LLC or corporation, complete your Secretary of State filings and confirm your entity details.
- Check your city's local business tax or registration requirement.
- Gather the registration details listed above, including your EIN and supplier information.
- Register online with the CDTFA. Remember that the permit is free.
- Prepare a written resale certificate, or the optional CDTFA-230, for each supplier.
- Calendar your sales and use tax return due dates, and file even in months with zero sales.
- Keep your records for at least four years.
A California seller's permit is a straightforward registration. The rules that cause problems are the ones around resale certificates and filing. Get those right from the start, and you avoid most of the trouble.