How to Register for a Sales Tax Permit in Minnesota

Who Needs a Sales Tax Permit in Minnesota

In Minnesota, businesses that sell tangible goods, products, or services subject to sales tax are required to collect and remit sales tax. This includes physical storefronts, service providers, and online retailers. 

The economic nexus threshold in Minnesota mandates that businesses with over $100,000 in taxable sales or 200 or more separate retail transactions in the state must collect sales tax, even without a physical presence in Minnesota. 

Common examples include local boutiques, contractors offering taxable services, and out-of-state online sellers surpassing the threshold.

Steps to Register for a Sales Tax Permit in Minnesota

Follow these steps to register for a sales tax permit in Minnesota: 

1. Gather Your Documentation

Ensure you have the following information ready: 

• Legal Business Name: This should match the name registered with the Minnesota Secretary of State.
• Business Address: A valid street address is required; typically, P.O. boxes are not acceptable.
• Federal Employer Identification Number (FEIN): Obtainable from the IRS if not already held.
• Contact Information: Include phone numbers and email addresses of key business contacts.
• North American Industry Classification System (NAICS) Code: Identifies your business’s industry. 
• Business Start Date in Minnesota: Indicate when your business began or will begin operations in the state.

2. Register Online via e-Services

To register, access Minnesota’s e-Services portal, select “Register a new business,” fill in the necessary information accurately, review the application, and submit it through the portal.

3. Await Approval

It usually takes a few business days to receive your account number after online registration. Upon approval, you’ll get your sales tax permit, authorizing sales tax collection in Minnesota.

The process can be cumbersome if done alone. doola’s Bookkeeping services offer streamlined assistance throughout the process, ensuring compliance and peace of mind. 

Understanding Your Sales Tax Responsibilities in Minnesota

In Minnesota, sales tax returns are typically filed on a monthly, quarterly, or annual basis, based on the volume of sales. It’s crucial to apply the correct sales tax rates, which may differ by location, covering state, county, and city levels. Minnesota offers exemptions and provisions like tax-free holidays and resale certificates, affecting sales tax collection.

Common Pitfalls to Avoid

• Neglecting to register for a sales tax permit when required.
• Incorrectly collecting sales tax rates for different jurisdictions.
• Missing deadlines and attracting penalties.
• Overlooking exempt sales and neglecting proper documentation for resale certificates.

How to Stay Compliant & File Sales Tax Returns

Use Minnesota’s e-Services portal to file sales tax returns and remit payments electronically. Automated solutions can simplify tax collection and ensure accuracy. 

Remember, doola can assist with bookkeeping and taxes, ensuring your business remains compliant easily and efficiently. 

FAQs About Sales Tax Permits in Minnesota

How long does it take to get a sales tax permit? 

Generally, it takes a few business days for the Minnesota Department of Revenue to process a sales tax permit application.

Is renewal required for a sales tax permit? 

No, once issued, a sales tax permit in Minnesota does not need renewal if compliance is maintained. 

What if I cease doing business in Minnesota? 

You must formally close your sales tax account by notifying the Minnesota Department of Revenue. 

Are online retailers obligated to collect Minnesota sales tax? 

Yes, online sellers exceeding the economic nexus threshold are required to collect Minnesota sales tax.

Maintain Compliance With doola 

Getting a sales tax permit is vital for businesses operating in Minnesota. Staying compliant involves knowing filing deadlines, collecting accurate taxes, and understanding exemptions. 

Consider professional assistance to ensure accuracy in this process. For financial guidance, doola provides comprehensive support to guarantee compliance, helping your business succeed. 

Visit the Minnesota Department of Revenue for further information and resources.