How to Get a Resale Certificate in Utah

How to Get a Resale Certificate in Utah

How to Get a Resale Certificate in Utah

If you're starting a retail business or selling goods in Utah, you'll need a resale certificate, also called a sales tax permit or seller's permit. This certificate allows you to purchase inventory without paying sales tax upfront, since your customers will pay tax when they buy from you. Without it, you'll pay tax on wholesale purchases and then collect it again from customers, eating into your margins.

Utah's State Tax Commission issues resale certificates to any business with an "established presence" in the state. The process is straightforward, takes about 15 minutes to apply online, and you can be approved the same day.

What You'll Need Before You Apply

Gather these items before sitting down to complete your application:

  • A registered business entity (if structured as LLC, corporation, or partnership). Sole proprietors can apply under their Social Security Number, but registered entities need their federal EIN (Employer Identification Number) from the IRS.
  • A physical street address in Utah where your business operates or stores inventory. A PO box does not qualify. If you operate from home, use your residential street address. If you're renting retail space, use the storefront address.
  • Your Social Security Number or EIN. The Tax Commission uses this to issue and track your permit.
  • Expected monthly sales volume estimate. This helps the state understand your business size, though estimates can be revised later.
  • A description of what you're selling. Be specific: "Women's apparel and accessories" or "HVAC equipment and parts," not just "Retail."
  • Your phone number and email. The Tax Commission may contact you with questions or if your application needs clarification.

Step-by-Step Instructions

Step 1: Register Your Business with the State (If Not Already Done)

If you're operating as an LLC or corporation, you must file a formation document with the Utah Division of Corporations and Commercial Code before applying for a sales tax permit. Sole proprietors skip this step unless they're using a DBA (Doing Business As name).

LLCs file a Certificate of Organization and pay a $59 filing fee. Corporations file Articles of Incorporation with the same fee. If you're using a business name that's different from your legal name, file an Assumed Name (DBA) registration for $22.

File online at businessregistration.utah.gov using your UtahID login, or mail paper forms to the Division. Most online filings are approved instantly or within 2 to 4 business days.

Step 2: Obtain Your EIN (If Applicable)

If your business is an LLC, corporation, partnership, or any entity other than a sole proprietorship, you need a federal Employer Identification Number from the IRS. Sole proprietors can use their Social Security Number instead.

Apply for an EIN free online at irs.gov/ein. You'll receive your EIN immediately if you apply online. If you mail an application (Form SS-4), approval takes about 4 weeks.

Step 3: Go to the Utah State Tax Commission Online Portal

Navigate to tap.tax.utah.gov/TaxExpress. This is the state's online portal for applying for a sales tax license (resale certificate). You can also mail a paper Form TC-20 if you prefer, but the online system is faster.

Step 4: Complete the Online Application

The online application asks for:

  • Legal business name. The name on your formation documents or your personal name if you're a sole proprietor.
  • DBA (if any). The name you do business under if it differs from your legal name.
  • Your business structure. Select Sole Proprietorship, LLC, Corporation, Partnership, etc.
  • EIN or SSN. Provide your federal Employer Identification Number or Social Security Number.
  • Utah street address. The physical location where you conduct business or store inventory. This is required; a mailing address alone will not be accepted.
  • Mailing address. Can be a PO box if different from your business address.
  • Ownership and management information. Names and titles of owners or managing members.
  • Business description. Describe what you sell or the services you provide.
  • Expected monthly sales. Your best estimate of average monthly revenue. You can update this later if your actual sales differ.
  • Start date. When you plan to begin operating in Utah.

Fill out all required fields marked with an asterisk. Review the information for accuracy before submitting.

Step 5: Pay Any Required Fees

Utah does not charge a state application fee for a resale certificate or sales tax license. However, some cities and counties charge a local business license fee (typically $25 to $150 per year). That's a separate process handled at the local level, not by the state.

If you're hiring employees, you'll also need to register for unemployment insurance with the Utah Department of Workforce Services, but that's done separately.

Step 6: Receive Your Permit Number

Once you submit your application online, the Tax Commission typically approves it within hours or the same business day. You'll receive a confirmation email with your Sales Tax License Number (also called your Resale Certificate Number or Seller's Permit Number).

This is the number you'll provide to your suppliers when purchasing inventory for resale. Write it down and keep it handy. You'll need it every time a wholesaler asks for your resale certificate to verify you don't owe sales tax on bulk purchases.

Step 7: Apply for Any Required Local Business Licenses

After the state approves your resale certificate, check with your city or county to see if they require a local business license. Requirements vary widely. Some municipalities charge a flat annual fee; others charge based on your estimated gross receipts. Some don't require a separate license at all if you're already registered with the state.

Contact the city clerk or business licensing department in the city where you're operating. They'll tell you what's required and the fee.

Tips to Avoid Common Mistakes

  • Use a real street address, not a PO box. The Tax Commission requires a physical location where your business operates or where inventory is stored. A mailbox center address may work if you're conducting business there, but a post office box will not.
  • File your business formation documents first. If you're an LLC or corporation, register with the state before applying for your sales tax permit. Some online systems will auto-populate your business name and registration status; mismatches can slow approval.
  • Get your EIN before applying if you're not a sole proprietor. Having your federal EIN ready when you fill out the tax permit application speeds things up. The Tax Commission matches state and federal records.
  • Provide a detailed business description. "Retail" or "Goods" is too vague. The Tax Commission uses this to route your application to the right division and to flag any industry-specific requirements. Say "Women's athletic apparel and footwear" or "Commercial HVAC parts and equipment."
  • Update your expected sales if they change significantly. If you estimated $5,000 per month but you're actually doing $50,000, update your permit. The Tax Commission uses this for audit planning.
  • Don't confuse a resale certificate with a business license. The resale certificate is your state sales tax permit. A business license is a local requirement in most cities. You need both, they serve different purposes.
  • Renew your permit if required. Utah requires annual renewal of your sales tax license during your anniversary month. The renewal window opens 60 days before your anniversary date. A late renewal fee of $10 applies if you miss the deadline. The state will send you a reminder email, but don't rely on it, mark your calendar.

What Happens After You're Approved

Once you have your resale certificate number, you're authorized to buy inventory without paying sales tax. When you purchase goods from a wholesaler or distributor, provide your certificate number. The supplier keeps a record of it and doesn't charge you sales tax on that transaction.

You then collect sales tax from your customers when they buy from you. Utah's state sales tax rate is 4.85 percent (1.75 percent on grocery food). However, combined state and local rates vary by location, they range from 6.35 percent to 10.05 percent depending on which city and county you're in.

You must file sales tax returns with the Utah State Tax Commission. The filing schedule depends on your sales volume:

  • Monthly returns: Required if your average monthly sales tax liability is $500 or more.
  • Quarterly returns: Required if your average liability is between $100 and $500 per month.
  • Annual returns: Required if your average liability is less than $100 per month.

File online at tap.tax.utah.gov/TaxExpress. Payments are due by the 20th of the month following the end of your filing period.

When to Consult a Professional

The resale certificate application itself is straightforward and most businesses can complete it without help. However, consider consulting a CPA or tax attorney if:

  • Your business structure is complex (multiple owners, partnerships, S-corps, etc.) and you're unsure which EIN and ownership information to provide.
  • You're selling from multiple locations and need separate permits for each.
  • You're selling items that might have special sales tax treatment (groceries, pharmaceuticals, certain services). Some goods are taxed differently in Utah.
  • You're unsure whether your business owes other state taxes (like corporate income tax or franchise tax).
  • You're an out-of-state business shipping to Utah customers and need guidance on nexus and remote-seller obligations.

This content is informational only and is not legal or tax advice. For guidance specific to your business, consult a qualified CPA or attorney licensed in Utah.

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