To help keep finances under control, having a resale certificate is crucial. A resale certificate is a document that states that your business is exempt from paying sales tax on products you resell. This certificate proves that the products you purchase will be resold to your clients and the products are not intended for personal use.

How Do Wholesale Exemptions Work?

As a retailer with a valid resale certificate, you do not need to pay sales tax on our products. Since you're intending to sell the product to your own customer (i.e. "end-user"), that customer will be charged the sales tax, not the other way around. By purchasing from Pelican Int'l (a wholesaler), you're able to save on paying sales tax, since it is passed on to your customer.

Benefits of Resale Certificates

• Better Cash Flow: Since tax is collected on your customer's purchases (and not your own through your vendor), this leaves more room for cash flow throughout your business.
  
• Better Recordkeeping: Resale certificates help you keep track of your records. This makes it easier to see which purchases throughout the year require tax or not, useful for bookkeeping purposes and in the event of an audit. 
  
• Better Compliance: Filling out a resale certificate ensures that the purchases abide by state laws and regulations regarding exemptions, building peace of mind.

What to Consider

Keeping an up-to-date resale certificate is recommended--and in some states, mandatory. The state of Florida, for example, requires a new resale certificate every year. By providing this certificate to your supplier or vendor, you're providing them with proof of your tax exemption. We require an updated resale certificate each year. This verifies your exemption and keeps everything aligned when you purchase from us.

Tip: The Sales Tax institute has a valuable article about this topic. Their website has plenty of resources that break down sales tax for professionals at any stage--from beginner to advanced.

How To Obtain a Resale Certificate

Receiving a resale certificate is relatively straightforward.  Access your state's Department of Revenue site and fill or print out the application. You'll need your business license and tax identification number. Note: Sellers in Florida will need to register for an account with the DOR in order to access this document. 

Still have any questions? We're here to help! Reach out to your dedicated account representative, or give us a call at 727-388-9895.