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Sales Tax License FAQ
Is there a fee for a sales tax license?
No, there is not a fee for a sales tax license.
Who needs a sales tax license?
Who is required to have a sales tax license? - Individuals or businesses that sell tangible personal property to the final consumer need a sales tax license. An application for a sales tax license may be obtained on our web site. In order to register for sales tax, please follow the application process.
City/Local/County Sales Tax - Michigan has no city, local, or county sales tax. The state sales tax rate is 6%.
Retailers - Retailers make sales to the final consumer. Sales tax of 6% on their retail sales must be remitted to the State of Michigan. In addition, retailers must be licensed to collect tax from their customers and remit the sales tax to the State of Michigan.
Wholesalers - Wholesalers sell to other wholesalers or retailers and not to the final consumer. The price at which the seller sells a product does not determine if the seller is a wholesaler. The determination is based on whom the products are sold to by the seller. Wholesalers buy for resale at wholesale. They are not making retail sales; therefore registration for sales tax is not required. Wholesalers claiming an exemption should provide a written statement that they are purchasing for "resale at wholesale".
Contractors - A sales tax license is not required for contractors or subcontractors, since they are the final consumers of the materials they affix to real property. Anyone who is directly engaged in the activity of constructing, altering, repairing, or improving real estate for others is liable for the sales tax on the inventory value of the materials affixed to the property. If the real estate being constructed, altered, repaired, or improved is a nonprofit hospital or nonprofit housing entity, no tax is due on any materials which became affixed to and made a structural part of the hospital or housing entity. This information may be obtained in Revenue Administrative Bulletin 1988-35 and 1999-02.
Services - Businesses repair, improve, or alter tangible personal property owned by others. Businesses, who sell tangible personal property in addition to providing labor or a service, are required to obtain a sales tax license. Any property which goes with the customer in connection with the repair or service is considered a sale at retail and subject to sales tax.
Out-of-State Businesses - For transactions occurring on or after October 1, 2015, an out-of-state seller may be required to remit sales or use tax on sales into Michigan. See Notice of New Sales and Use Tax Requirements for Out-of-State Sellers.
May I start selling products if I have submitted my Registration Application (Form 518) but have not received my sales tax license?
You are not required to wait for your sales tax license to arrive to begin selling items at retail. However, as soon as you begin selling items at retail, you are required to remit sales tax to the State of Michigan.
Once your application is processed, your sales tax license is available on Michigan Treasury Online (MTO) immediately with registration access.
When should I pay my sales tax with a Concessionaires Form (5089) and when should I register for sales tax with a Registration Form (518)?
If you make retail sales at only one or two events in Michigan per year, you may complete Form 5089, Concessionaire's Sales Tax Return and Payment, or, if you prefer, you may apply for a sales tax license.
If you make retail sales at more than two events in Michigan per year, you must have a sales tax license.
I am a wholesaler. Do I need a sales tax license?
No, Michigan does not issue sale tax licenses to wholesalers. In order to claim an exemption, a wholesaler must provide the seller with a completed Form 3372, Michigan Sales and Use Tax Certificate of Exemption, and indicate that the purchase is for "Resale at Wholesale".
How do I obtain a sales tax license?
You must register for sales tax and/or use tax on sales and rentals.
To register for Michigan business taxes, you may either complete the online eRegistration process through MTO or mail Form 518, Registration for Michigan Taxes. Business registration cannot be done over the phone. eRegistration is authenticated within 10-15 minutes of application submission. If mailing Form 518, allow 4-6 weeks for processing.
Additional registration information for the application process can be found by visiting the Michigan Registration Web page.
Treasury has discontinued sending SUW tax booklets; how will I get my sales tax license?
Sales tax licenses are available on MTO with Registration access. Sales tax licenses are issued yearly and are valid January - December of the tax year listed on the license.
What is the expiration date for my current Sales tax license?
Sales tax licenses are issued yearly and are valid January - December of the tax year listed on the license.
How can I request a copy of my sales tax license?
Taxpayers can print their current sales tax license from MTO with Registration access.
Alternatively, taxpayers or a power of attorney can request a copy of a sales tax license by calling the Registration Unit at 517-636-6925.
Allow 7-10 days for mailing.