When a Maine business purchases inventory to resell, it can often do so without paying sales tax. To do so, the retailer must provide a Maine Resale Certificate to its vendor.

Learn more about how the Maine Resale Certificate works, how to get one, and more.

How does a Maine Resale Certificate work?

When retailers purchase products to resell, they often don’t pay state sales tax to the supplier on the purchase. The sales tax will still be paid, but instead of the retailer paying sales tax, the retailer charges the state sales tax to their customer on the final value of the merchandise.

For instance, when a bookstore in Maine procures a new collection of books to offer in its store, the bookstore owner can provide a resale certificate to its vendor to skip paying state sales tax on its inventory. Later, when a customer decides to buy a book from the store, the retailer will apply sales tax to the customer based on the full price of the book. Then, typically at the end of each month, the bookstore sends the collected sales tax to the Maine Revenue Services.

Be sure to note that the sales tax exemption is only intended for inventory that will be resold and not for the tax-free purchase of items used in normal business operations, such as paper, pens, etc.

Applying for the Resale Certificate

Before a business starts selling products or providing taxable services, it must first get a Sales Tax License (sometimes referred to as a seller’s permit) from Maine Revenue Services. After registering for the license, the Resale Certificate will be automatically issued if the business indicates they anticipate making over $3,000 annually.

Example Maine Resale Certificate

Maine Resale Certificate FAQs

How much does a Maine Resale Certificate cost?

There is no cost for a Maine Resale Certificate

Does a Maine Resale Certificate expire?

Maine Resale Certificates are valid from the date of issue to December 31^st, plus three years. The certificate will be automatically renewed if the certificate holder has reported $3,000 or more in gross sales during the previous 12 months.

How often is Maine sales tax due?

Most new businesses are set up to file and pay sales and use tax monthly, but depending on the amount of tax collected, your business may have a different filing frequency.

Where do I file the Maine Resale Certificate?

In Maine, the certificate is not filed with any government agency. Instead, it is kept by the seller (the business selling the merchandise for resale).

Is a Resale Certificate the same as a Sales Tax License?

The Sales Tax License and Resale Certificate are commonly thought of as the same thing, but they are actually two separate documents. The Sales Tax License allows a business to sell and collect sales tax from taxable products and services in the state, while the Resale Certificate allows the retailer to make tax-exempt purchases for products they intend to resell.

Also, in addition to these, your business may need to register for additional items. For more information, check out our guide to Maine business licenses.

What steps should a business take to accept a resale certificate?

When a small business is presented with a resale certificate, the seller has the burden of proof to verify that the buyer’s information is correct and to keep these records. Failing to verify this information may result in the seller being liable for Maine sales taxes.

Before accepting a resale certificate, a seller should:
– Review the resale certificate to make sure it is completely filled out.
– Verify the purchaser’s Maine certificate is valid and active by visiting the Maine Revenue Service’s website.
– Sellers are also responsible for examining the certificate and evaluating whether the goods sold are reasonably consistent with the purchaser’s line of business. For example, if the buyer’s business is a car dealership but wants to purchase office supplies tax-free, the seller should investigate further.
– Resale Certificates must be kept on file for a minimum of 6 years.