Definition of New Jersey Certificate of Authority
New Jersey division of taxation issues New Jersey Certificate of Authority. Every vendor or seller who sells taxable items is required to obtain a sales tax certificate of authority in order to collect sales tax on taxable items and services. The Form NJ-REG is completed electronically to print a New Jersey Sales Tax Permit Online.
Who Must Apply For The Sales Tax Authority New Jersey?
A person or a company who has a partial or outright existence in the state of New Jersey and selling taxable products and services to the end users within the state of New Jersey is required to get a certificate of authority from the NJ Division of Taxation.
What is a criteria to determine if a vendor has a sufficient nexus with the New Jersey consumers?
Nexus means a presence or connection of a person, seller and the presence in the state of New Jersey. It is described below in detail.
Person: is an individual which includes an individual, corporation, limited liability company, nonprofit organization, public corporation, association, society, referee, fiduciary, joint stock company, receiver, estate, association, partnership or any legal entity which is registered with the state of New Jersey.
Seller or Vendor: is a person or company who maintains a place in the state of New Jersey to sell product and services.
Presence or Existence: It decides where the products and services are subject to sales tax or not based on the vendor and buyer presence in the state of New Jersey.
Citation of Nexus:
Following examples will simplify the process of charging sales and use tax from buyers.
Citation Number One: If a New Jersey vendor sells taxable items to a New Jersey years. Simply sales tax is charged.
Citation Number Two: A New Jersey vendor sells taxable goods to an out of state buyer such as New York. The New Jersey vendor will not collect sales tax, but the New York buyer is responsible to pay use tax end of the year to the New York division of taxation and finance. It is reported through income tax return.
Citation Number Three: A New Jersey vendor sells goods to an out of state buyer, such as New York and NJ vendor has a location in New York. The New York vendor is responsible to collect sales tax from local buyers and pay to the New York division of taxation and finance.
Citation number three is a perfect example of drop shippers.
New Jersey Sales and Use Tax
Sales tax is charged from a local buyer whereas use tax is charged from an out of state which is paid by a buyer to the state directly.
How to apply for a New Jersey Sales Tax Registration?
Certificate of authority is acquired from the New Jersey division of taxation and following information are provided on the online form.
Name of the business which is legally registered as a corporation, LLC, Sole Proprietor or legal name of the person.
Business description along with the state code to classify accurately.
Complete business address (PO Box is not acceptable).
All owners' information, including name, address, social security number (not applicable for non US resident) and date of birth.
Percentage of ownership of each partner.
Employer identification number if incorporated as a Corporation or an LLC. An EIN is not required or a sole proprietorship business structure.
State of New Jersey does not charge any fee to issue certificate of authority.
A New Jersey sales tax, registration application is submitted to the New Jersey division of taxation fifteen days prior engaging any business activity.
Other sales tax, registration provisions:
The state may reject the sales tax application if it is incomplete, already have a certificate of authority for the same business or owe prior taxes.
A duplicate copy of the NJ certificate of authority is requested to the NJ division of taxation if it was lost or damaged.
A NJ certificate of authority is surrendered to the NJ division of taxation upon closing down business permanently.
Does' State of New Jersey has a provision to renew the NJ certificate of authority?
No, the New Jersey certificate of authority is not renewed.
What are the sales tax filing frequencies in the state of New Jersey?
Sales and use tax filing frequency is determined by the division of taxation New Jersey based on sales volume and liability withholding.
All businesses are required to file quarterly sales and use tax returns with the New Jersey Division of Taxation regardless of whether or not any sales were made or tax was due during the quarter. The total amount of tax due for the quarter, after taking credit for any monthly payment(s), must be remitted with the return.
If business had collected more than $30,000 in sales and use tax in New Jersey during the preceding calendar year must file a monthly remittance statement.
What are the responsibilities of a New Jersey Certificate of Authority Holder?
New Jersey Sales Tax Certificate of Authority must be prominently displayed at the business location.
Business name registration certificate displays at location prominently
File sales and use tax returns on a timely manner of the New Jersey division of taxation website electronically.
