Gaahhh!! I officially registered my business with the county and filed for a Sales Permit! I started creating handcrafted sage and Palo Santo bundles out of my desperate need to create, stimulate and distract my mind. Its only been 2 weeks since I've started creating and I've already had good traction. This blog was created simultaneously and I'm going to share with you what I've encountered while setting up a sole proprietorship.
I have a background in banking and have been in the industry for 10 years and know a thing or two about setting up a business however, when it came to registering my own for the first time, all of that knowledge went out the door and was feeling major Imposter Syndrome -Listen to the On This Frequency Podcast where we talk about Imposter Syndrome, (gotta plug myself lol). I gave myself a pep talk, "Natalie you know what you're doing, you have helped others. It's time to help yourself."
Registering with the state of California and the county that I live in isn't exactly a walk in the park, but it isn't difficult either, it just takes some dedicated time to read through the applications. I'm able to get by because part of banking is knowing the types of entities that exist, the various business industries that exist, what their NAICS codes are, their anticipated monthly sales... you get the point. I've also registered another business where I was a Partner in an LLC with my sister-in-law, so I have gone through the notions in the past.
First lets talk about filing a DBA (Doing Business As).
If you are a sole proprietor, this means you are the only owner of that business
I'll take the example of my business, Primavera Color Limon. Because I chose this name I have to file it with the County i live in. If I would have chosen my last name to do business, for example, "Mota's Blogging Services" I would NOT have to file with the County... and this is true for most counties but be sure to check with your County Clerks office as there might be different laws. This information is relevant because you will use the proof of name filing to establish a business bank account, as well as the information you will use for your seller's permit.
Side note: San Bernardino county charges a $55 fee to file a DBA as of 8/12/2021
When applying for a seller's permit for a business don't get intimidated by the verbiage used. Take a moment, think about what the application is asking for, GOOGLE IT! Ask someone who might know, save your application as a draft or take note of what information is being asked.
Starting a business is difficult enough, don't let applications talk you out of anything.
I've also found that my local CDTFA office is very knowledgeable and helpful in guiding me through the process of paying sales taxes. I'm considering myself lucky as I know this isn't always the case, but don't be scared to make phone calls, there are people out there getting paid to answer our questions, so if you didn't get your answers, keep calling and keep asking!
Now what the heck is a NAICS code?! Probably the most time consuming thing in banking when working with business clients is looking for the appropriate NAICS CODE -A classification with the North American Industry Classification System, which is basically a fancy term for your business description in order to gather statistical data about the U.S. business economy.
When applying for your sellers permit you will be asked to select the NAICS code that closely describes your business (you can select more than one and have a primary code). The thing about selecting a NAICS code for a business is that the options given are very broad and sometimes timely, not DIFFICULT! to find a code closest related to what a person does for business. So part of Primavera Color Limon, is handcrafted artisan goods and there are no options closely related to my business so I Googled "what is the NAICS for handcrafted goods" and I got a lot of useful information and ended up selecting one that closely matched. The codes can also be updated at a later time if necessary.
Applying for a Sales permit is free, but a huge tip is to pay attention to tax due dates. In California, taxes are paid quarterly so make sure you create an account to access your account and make payments online. CDTFA also sends tax payment reminders via email as due dates approach.
The following Link is a great resource from the IRS for information on what business expenses can be deducted, when it comes to filing taxes.
The link below is a great resource to identify the information you will need to complete the Sales & Use Tax application for your business!
Good Luck friends! I hope you found this information helpful. Drop me a line, let me know if there is anything you think might help the community.
Increase the peace! <3