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Sales Tax/ Sales Permit

This topic contains 2 replies, has 2 voices, and was last updated by  Jennifer 3 months, 1 week ago.

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  • #72776

    Jennifer
    Participant

    Hi all,
    Coming to you from California… Does anyone understand the necessity/ circumstances for when a sales permit is needed, and when we charge sales tax? I’m seeking to understand whether we are selling direct to consumer (fulfilling online orders, doing delivery and pickup) and events like farmer’s markets, if we have to include sales tax in our pricing. If so, how do we separate this tax collection? etc any clarification on this process would be helpful. Thank you!

    • This topic was modified 3 months, 1 week ago by  Jennifer.
    #72779

    Cottage Oven
    Moderator

    Don’t know about California – I’m in Florida, but the following may be helpful as some general guidelines to help you find the answers that would be specific to California.

    Here, in Florida, most items sold under cottage-food law would NOT be taxable, but CANDY is ALWAYS taxable. Thus, bread, cookies, cakes, muffins, etc. would not be taxed but caramels, fudge, chocolates, etc. would be taxed.

    There is also one more thing to consider: does the venue where you are selling charge admissions for customers to enter? If so, then items that are big enough or packaged for taking away from the venue are not taxable. Things that are sold to be eaten on the premises, however, are taxable. Thus, if you sell a blueberry muffin at a regular farmers market, it wouldn’t be taxed, but if you sold it at a fair where the customer had to buy a ticket to get in, then it would be taxed.

    I hope that helps you at least somewhat, but do check with whoever oversees California’s cottage-food laws (perhaps Department of Agriculture) AND California’s sales-tax laws (perhaps department of revenue), since California’s laws are often vastly different from those of any other state.

    #72783

    Jennifer
    Participant

    This explanation is very helpful- thank you! Agreed that it’s best to check with the state/county as California always seems to be an outlier haha.
    Again, I appreciate the detail you’ve provided. I’m making a bar, which I guess one could consider a “biscuit” (hopefully) and therefore not taxable. Thanks again!

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