What is a New York Resale Certificate?
There are many businesses who have heard about a New York resale certificatebut might have questions about what exactly this certificate is. The purpose of investing in a resale certificate is that it allows a business to purchase goods through the company without having to pay any local sales tax. As a result, this saves the business a substantial amount of money on its overhead costs. When businesses are granted a resale certificate, it becomes the responsibility of the business to collect the appropriate sales tax from the customer when the item is sold.
How Does a Resale Certificate Work?
When someone is in possession of a New York resale certificate, the wholesaler who provides the business with the items will request to see the resale certificate. This is presented as proof that the items being purchased from the wholesaler are going to be put back up for sale. This is also called a tax exemption certificate.
The resale certificate is typically going to include a few different pieces of information. This includes the name and the address of the business (or the buyer) along with the permit number of the business. The certificate will also often include a description of the items that are being purchased and sold by the business. Of course, the certificate will also say that the goods are being purchased for resale.
What are the Benefits of a Tax Exemption Certificate?
There are several benefits that come with using this tax exemption certificate. For example, the certificate will allow the business to avoid paying sales tax on the items being purchased from the wholesaler. These savings can be then be passed on to the customer, allowing the business to remain competitive. Without this certificate, the business would be forced to pay sales tax on the items that it purchases. With this certificate, the business can purchase more items and grow the company.
Where to Apply for a Resale Certificate
Typically, a business owner is able to apply for a resale certificate at the local state’s tax department. Once the tax exemption certificate has been granted, the state will typically provide monthly or quarterly statements. In addition, there are also specialized businesses that can help companies apply for a resale certificate. Importantly, the physical location of the business is the address that determines where to apply for the tax-exempt certificate. If the business has locations in more than one state, a resale certificate must be applied for and granted in all of the states. This is where a third-party specialist can help a company obtain all of these separate certificates. These certificates can play a major role in helping to grow a business.