Out-of-State Sellers: Do You Need to Register with California? (Publication 77)

Engaged in Business in California

If you are a retailer located outside California, you are required to register with the California Department of Tax and Fee Administration (CDTFA) and collect California use tax on your taxable sales and report and pay the tax to CDTFA if you are "engaged in business in this state." You are engaged in business in this state if any of the following situations apply to your business:

1. Business location in California

You maintain, occupy, or use, directly or indirectly, or through a subsidiary or agent, a permanent or temporary office, place of distribution, sales or sample room, warehouse or storage place, or other physical place of business in California.

2. Representative in California

You have a representative, agent, or independent contractor operating in the state on your behalf or under your authority, or under the authority of your subsidiary, for the purpose of making sales, taking orders, assembling or installing merchandise, training customers, making deliveries, or otherwise establishing or maintaining a market for your products.

3. Lease property in California

You receive rental payments from the lease of personal property that is located in California, such as lease of machinery, equipment, and furniture. For more information on leases of personal property, see our publication 46, Leasing Tangible Personal Property.

4. Real or Personal Property

You own or lease real property or personal property located in California such as machinery, equipment, furniture, or a computer server.

5. Sales for Delivery in California

Beginning April 1, 2019, you are engaged in business in this state if, during the preceding or current calendar year, the total combined sales of tangible personal property for delivery in California by you and all persons related to you exceed $500,000. A person is related to you if they have a relationship with you as described in Internal Revenue Code section 267(b) and related regulations. Prior to April 1, 2019, you would not be engaged in business in this state based upon your sales for delivery in California.

For more information about California state, local, and district use tax collection requirements, please see Use Tax Collection Requirements Based on Sales into California Due to the Wayfair Decision.

Courtesy Collection of Use Tax

California consumers are responsible for paying the state, local, and district use tax on purchases from retailers that do not collect the tax. If you are not required to register with CDTFA, you may choose to voluntarily register with CDTFA for a Certificate of Registration–Use Tax to collect and pay use tax as a convenience to your California customers. If you hold such a certificate, you will be required to collect and pay tax from purchasers in the same manner as retailers engaged in business in this state. Your obligation to collect and pay tax will continue until you close out your Certificate of Registration–Use Tax.

Registration

If you are not currently registered with CDTFA, you may register with us online.

From our Taxpayer Online Services Portal, scroll down to Registration, select Register a New Business Activity or Location, and follow the prompts.

In addition to holding a seller's permit or Certificate of Registration–Use Tax, you may also need to register for another license or permit with CDTFA. For more information about the permits or licenses CDTFA administers and the registration requirements please see the Additional Accounts, Licenses, Permits page.

If you are an online retailer, additional registration information is available on the Online Retailers: Registration and Local Tax tab of our Local and District Tax Guide for Retailers that you may find helpful.

Please note: This publication summarizes the law and applicable regulations in effect when the publication was written, as noted on the cover. However, changes in the law or in regulations may have occurred since that time. If there is a conflict between the text in this publication and the law or regulations decisions will be based on the law or regulations and not on this publication.