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Most businesses starting in Idaho that are selling a product or offering certain services will need to register for a Seller’s Permit. This is commonly referred to as a sales tax permit, sales tax license, sales tax number or sales tax registration.
The seller’s permit is obtained through the Idaho State Tax Commission as a part of the Idaho Business Registration application.
Check out the rest of this guide to find out who needs a seller’s permit, what products and services are taxable, how to register for a permit and reporting requirements.
Who needs a seller’s permit in Idaho?
A business must register for a seller’s permit in Idaho when:
- A business has “nexus” (significant presence in the state) such as a retail store, office or warehouse where products are produced, stored and/or delivered
- Renting or leasing property (excluding real estate) to a customer who uses that property in Idaho.
- Servicing tangible personal property in Idaho
- Having a salesman, agent or representative who is physically selling, delivering, installing or taking orders in the state.
- Selling products or certain services to Idaho residents
- An online business located in Idaho is selling taxable products to Idaho residents
- An out-of-state business selling over $100,000 of physical products to Idaho residents
What products and services are taxable in Idaho?
There are a few exceptions, but almost all physical products are taxable when sold at retail in Idaho. Common examples include:
- General merchandise like food, furniture, appliances, and clothing
- Titled or registered items like vehicles
Prescriptions are tax-exempt.
Labor in most cases isn’t taxable in Idaho. For instance, let’s say you broke the screen to your cell phone and take it to a cell phone repair shop to have it fixed. Sales tax would be added to the selling price of the new screen and any additional parts to fix the phone. The labor to replace the screen isn’t taxable. However, a business that makes furniture will indirectly have sales tax on labor. In this instance, let’s say this business is building a dining room table for a customer. Through labor, the pieces of wood are shaped, sanded and painted to build this piece of furniture. While the labor isn’t directly taxable, sales tax is charged to the final selling price of the table.
Digital products are mostly tax exempt with the exception of software the buyer has a permanent right to use such as a video game, movie or music.
Most services aren’t taxable in Idaho, however there are a few exceptions.
- Admission charges such as tickets to a movie, sporting event or cover charges
- Membership fees for a gym
- Greens fees for a golf course
How to register for a seller’s permit in Idaho
Businesses making infrequent sales each year such at a craft show, fair, fireworks stand, etc. may opt for a Temporary Seller’s Permit. This type of permit is good for up to 90 days and up to three permits can be applied for per year.
Information needed to register includes:
- Type of business entity (Sole Proprietorship, Partnership, Corporation, LLC)
- Federal Employer Identification Number (FEIN), or SSN if a sole proprietorship with no employees
- Business name
- Date business began
- Date taxable sales will begin
- Estimated monthly taxable sales
- Business address and phone number
- What the business manufactures or sells
- Names and addresses of owners/officers/members
- Description of what products or services are being sold
- Employee information
After receiving the permit, it must be displayed in a visible location at the business. A business with multiple locations will receive a seller’s permit for each one.
How much does a seller’s permit cost in Idaho?
There is no cost for a seller’s permit in Idaho.
How long does it take to get an Idaho seller’s permit?
Expect 10 days to receive a seller’s permit when registering online or 4 weeks when applying by mail.
Do you have to renew your Idaho seller’s permit?
The seller’s permit is a one-time registration and no renewals are needed. Be mindful that if any information about the business changes such as the mailing address, additional locations or change in ownership, those changes need to be updated with the State Tax Commission.
Sales tax reporting
How is sales tax collected?
When a business makes a sale of a taxable product or service, the business charges the appropriate sales tax rate to the customer. This tax is collected by the business who then sends it to the Idaho State Tax Commission.
How much sales tax is charged?
The sales tax rate that is charged varies depending on the address of the business if the purchase is made or shipped from a business located in the state. If the seller is based out of the state, the sales tax rate is based on the buyer’s address.
In addition to the statewide tax, some resort cities and auditorium districts in Idaho add a local sales tax to purchases. To find the sales tax for your location, see the sales tax rate table from the Idaho State Tax Commission.
When are Idaho sales tax returns due?
The State Tax Commission will determine a filing frequency based on the expected volume of annual sales, which will be monthly, quarterly, semiannually or annually. Generally, a collecting over $9,000 annually in sales taxes will file monthly.
Filings are due the 20th day of the month following the reporting period, unless the 20th falls on a weekend or federal holiday, in which case would move to the next business day.
Even if the business had no sales during the reporting period, a filing is still required indicating no sales occurred.
Sales tax on purchases for resale
A business is able to purchase items to resell without paying state sales tax. The tax liability is passed from the distributor to the retailer who will then charge sales tax to the end user of the item.
Wholesalers and distributors will require a sales tax number, and in many cases require the reseller to fill out the Resale Certificate (Form ST-101) to document the items being purchased are for resale.
If you have questions about the seller’s permit, the Idaho State Tax Commission has a guide to sales tax rules in Idaho or can be contacted by calling 208-334-5364.