Why Your Business Needs a Texas Resale Certificate
Any business that sells goods within Texas state or online to customers located in Texas is required to collect sales tax from the buyer. All businesses that collect sales tax in Texas must pay taxes to the state, and are therefore required to file for a certificate, or may face a penalty. Depending on your location, local taxing jurisdictions (cities, counties, special purpose districts, and transit authorities) can also impose up to 2% sales and use tax.
Does my business require a Tax Resale Certificate?
You may need a Tax Resale Certificate if any of the following describe your business:
- You operate in Texas and/or plan to sell or ship product to another party or customer in Texas
- You have employees or salespersons operating in Texas
- You have a place of distribution, including a warehouse or storage space
- Your business provides taxable services as a part of your operations
- There has been a change in your organization - such as a change of hands in ownership or a new location
- Your business purchases items for resale in Texas state, including wholesale
I do business online to customers located outside Texas, do I still need to provide the state with my tax information?
Yes! Even if you do not charge sales tax to customers located outside of Texas state, you must report the exempt tax sale to the State of Florida.
My business resells items that I purchase through wholesale - if I’m not paying taxes on wholesale purchases, why is a Tax Resale Certificate required?
All legitimate wholesale companies in Texas require a sales tax resale certificate for purchases, and should require a copy of your resale certificate before they sell to you at wholesale prices as a commercial retailer.