Any business that sells goods or taxable services within the state of Minnesota to customers located in Minnesota is required to collect sales tax from that buyer. This will include all online businesses. Any seller which conducts business and has a major presence within the state must collect sales tax in Minnesota must pay taxes to the state. Therefore, these sellers required to file for a Sales tax certificate. By not doing so the business may face sanctions or other types of penalties. Additionally, depending on the businesses location and tax jurisdiction, localities such as counties, cities, and other districts can also add additional sales and use taxes.
Do you need to get a Sales Tax certificate in Minnesota State?
You may need a Sales Tax Certificate if any of the following apply your business:
- You have a physical office or place you conduct
- You sell or ship products to a buyer in Minnesota
- You have a distribution location such as a storage area or warehouse space
- You have employees physically present in Minnesota (including independent contractors, sales persons, representatives, or agents)
- Your business delivers merchandise in the state of Minnesota in company owned vehicles
- Your business received at least $10,000 within a 12-month period in referral commissions
- Your business has taxable services in the state of Minnesota
What constitutes taxable services in Minnesota State?
The majority of service businesses are not taxable in Minnesota. The exceptions would be a service business that manufactures or fabricates a product.
Why do I need a Sales Tax Certificate to purchase wholesale items for Resale in the State of Minnesota?
As a wholesale company conducting business in the state of Minnesota, you are required to have a sales tax certificate when purchasing items at wholesale prices, Therefore, suppliers must request a copy of your resale certificate before selling you items at wholesale prices.
Do you need to collect sales tax on shipping and handling of merchandise?
If you sell tangible goods in Minnesota that are taxable than you would charge sales tax on shipping and handling charges.
Is there sales tax on drop shipments in the state of Minnesota.?
A drop shipment is where a seller (most times out of state) sells a product which is then delivered to a consumer by a third-party shipper. In most instances, drop shipments in Minnesota. are required to have sales tax added
Are there any exemptions to taxable items sold?
Certain Clothing, infant goods, groceries, medical devices, raw materials, newspapers, and over the counter ( OTC ) medicines and custom downloadable software are tax exempt
Register for a Minnesota sales/use tax number
Minnesota state, county, city, & municipal tax rate table