Mississippi resale certificate withholding tax is a tax requirement imposed by the Mississippi Department of Revenue on businesses that regularly engage in selling tangible personal property for resale. This tax is collected on behalf of the state and is specific to Mississippi only. The purpose of the resale certificate withholding tax is to ensure that sales tax is properly paid when the items are sold to the final consumer. The Mississippi resale certificate withholding tax is applicable in situations where a business purchases goods from a supplier with the intent to resell them. By providing a resale certificate, businesses can buy these goods tax-free, eliminating the need to pay sales tax at the time of purchase. However, these businesses are then responsible for collecting and remitting sales tax when the goods are sold to the end consumer. There are two main types of Mississippi resale certificates withholding tax. The first is the Traditional Resale Certificate, which is used by businesses to certify that the items being purchased are solely for resale. This certificate is typically provided to suppliers or vendors when making purchases. The second type of resale certificate is the Direct Pay Permit. This certificate is issued to businesses that sell both taxable and non-taxable items. By holding a Direct Pay Permit, businesses can purchase both types of items tax-free, as they are then responsible for self-assessing and remitting the applicable sales tax. It is important for businesses to keep accurate records of their sales transactions and ensure that they have the proper documentation, such as resale certificates, to support the exemption from paying sales tax at the time of purchase. Failure to comply with the Mississippi resale certificate withholding tax requirements may lead to penalties, fines, or even legal consequences. In summary, the Mississippi resale certificate withholding tax is a mechanism to ensure that businesses collecting sales tax from end consumers properly report and remit the tax. By issuing resale certificates, businesses can purchase goods tax-free for the purpose of resale. The two main types of resale certificates are the Traditional Resale Certificate and the Direct Pay Permit. It is crucial for businesses to comply with these requirements to avoid any potential penalties or legal issues.
Mississippi Resale Certificate Withholding Tax
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Apply online at the DOR's Taxpayer Access Point portal to receive a Withholding Account Number immediately after completing the registration. Find an existing Withholding Account Number: on Form 89-105, Employer's Withholding Tax Return. by contacting the DOR.
Withholding Formula (Effective Pay Period 03, 2019) If the Amount of Taxable Income Is:The Amount of Mississippi Tax Withholding Should Be:Over $5,000 but not over $10,000$90.00 plus 4.00% of excess over $5,000Over $10,000$290.00 plus 5.00% of excess over $10,0002 more rows ?
Every employer engaged in business, licensed to do business, or transacts business in Mississippi or who pays wages to a Mississippi resident (regardless of where the services are performed), or pays wages to a non-resident (persons domiciled outside of Mississippi ) for services performed in Mississippi must register ...
In Mississippi, all a business has to do is apply for and obtain their sales tax permit. They do not need to apply for a separate resale certificate.