Running a retail business means buying inventory constantly. Pay sales tax on every wholesale purchase, and those costs pile up fast, eating into margins before you’ve sold a single item. A Georgia resale certificate changes that equation entirely.
Form ST-5 (sometimes called a resale license, reseller permit, or wholesale license) lets you purchase goods tax-free when you’re buying to resell. No more paying tax upfront and trying to reclaim it later. Present the certificate to suppliers, defer the sales tax to your customers, and keep cash flowing where it belongs. For retailers, wholesalers, and distributors, this is essential for staying competitive.
The catch? Misuse triggers audits and penalties. Hands Off Sales Tax (HOST) handles the details so you can focus on sales instead of paperwork.
What a Georgia Resale Certificate Actually Does
Form ST-5 is your proof of intent. It tells suppliers you’re buying inventory for resale, not personal use. Present it at purchase, skip the sales tax, and let the final consumer handle that obligation. The result: better cash flow and less administrative burden.
The Key Distinction
A sales tax permit authorizes you to collect tax from customers. A resale certificate (Form ST-5) lets you avoid paying tax to suppliers. You need the permit first, then you can use the certificate.
Who Needs One?
Under Georgia law O.C.G.A. § 48-8-2, any business selling tangible personal property needs a resale certificate:
- Retailers selling directly to consumers
- Wholesalers supplying products in bulk
- Manufacturers producing goods for distribution
Without Form ST-5, you’re paying sales tax on inventory. That cost either squeezes your margins or gets passed to customers, putting you at a disadvantage against competitors who handle it correctly.
The Cost of Skipping This Step
No certificate means paying sales tax on every wholesale purchase. Suppliers can’t give you that money back. Your accountant can’t reclaim it. And Georgia doesn’t take noncompliance lightly. Penalties hit 5% monthly, maxing at 25% of tax due, with interest compounding at 1% per month.
Getting Your Georgia Resale Certificate
The process runs through the Georgia Tax Center, the state’s online portal for all tax matters.
Before You Start
Register for a Georgia Sales and Use Tax Number first. This is mandatory under O.C.G.A. § 48-8-2 for anyone meeting the definition of a “dealer.” Good news: the system typically issues your number within 15 minutes via email.
Four Simple Steps
- Register Through GTC
Create your account and complete the sales tax registration. Keep your login credentials secure because you’ll need them for ongoing filings.
- Download Form ST-5
Get the ST-5 Sales Tax Certificate of Exemption directly from the Georgia Department of Revenue.
- Fill It Out Accurately
Include your business details and Sales and Use Tax Number. Double-check everything—errors cause delays and supplier headaches.
- Give It to Suppliers
Present the completed form when purchasing inventory. Most suppliers keep these on file for repeat transactions.
Using Your Certificate the Right Way
The rules are straightforward: use Form ST-5 exclusively for goods you’re reselling in their original form. Anything else like personal purchases, business supplies, consumed items, counts as misuse.
What Happens When You Present It
Hand your completed Form ST-5 to the supplier at purchase. They verify it’s properly filled and signed, then process the sale without adding sales tax.
For online purchases from wholesalers, email a PDF copy or upload it to their supplier portal. Most wholesale distributors keep certificates on file for repeat customers. Submit it once, then reference it for future orders.
Confirm suppliers accept it before completing larger transactions because some verify tax numbers using Georgia’s verification tool.
The Consequences of Misuse
Using a resale certificate for personal items or business consumption triggers serious consequences. Georgia assesses penalties of 5% monthly up to 25%, plus 1% monthly interest. Severe cases bring audits, criminal charges, or license revocation.
What Sellers Need to Know
Accepting resale certificates creates obligations. Georgia holds sellers responsible for verifying buyers’ legitimacy.
Verify Before You Accept
Use the Sales Tax ID Verification Tool in the Georgia Tax Center. Enter the buyer’s tax number, confirm it’s valid, and print the results. This tool only verifies Georgia numbers, not federal EINs, out-of-state licenses, or SSNs.
Keep the Paperwork
Industry best practice recommends retaining resale certificates and transaction records for at least three years. During audits, you’ll need:
- Copies of all Form ST-5 certificates
- Invoice numbers and purchase amounts
- Item descriptions
- Buyer contact and tax ID information
- Verification records from GTC
Store everything digitally for easy retrieval. Train your sales team on when to collect certificates and how to verify them. Regular audits of your own records prevent surprises during state reviews.
Common Mistakes That Cost Money
Using Certificates for the Wrong Purchases
The biggest misconception? Thinking resale certificates work for any business purchase. They don’t. Form ST-5 only covers goods you’ll resell in their original form.
Here’s what qualifies and what doesn’t:
✅ Qualifies: Buying wholesale t-shirts to sell online with your store’s branding
❌ Doesn’t qualify: Buying t-shirts to print your logo on: that’s manufacturing, not resale
❌ Doesn’t qualify: Buying display shelves or office furniture for your store: that’s business use, not inventory
✅ Qualifies: Buying candles from a wholesaler to sell in your boutique
❌ Doesn’t qualify: Buying candles to use in your store’s ambiance, that’s consumption
The line seems obvious until you’re in the middle of it. When doubt creeps in, err on the side of paying tax. Using Form ST-5 incorrectly triggers audits and penalties.
Cross-State Complications
Many states accept out-of-state resale certificates, but these don’t: Alabama, California, Florida, Hawaii, Illinois, Louisiana, Maryland, Massachusetts, Washington, and Washington D.C.
In those states, you need an in-state sales tax permit to obtain a valid certificate. Using your Georgia certificate there leads to rejected transactions and potential fines.
Multistate Certificates: A Simpler Alternative
If you’re purchasing from suppliers across multiple states, consider using multistate certificates instead of juggling dozens of state-specific forms:
The Streamlined Sales Tax (SST) Certificate works in 24 member states, including Georgia. One form covers purchases across all participating states.
The Multistate Tax Commission (MTC) Uniform Certificate provides similar coverage but with different state participation.
Both simplify compliance for businesses operating regionally or nationally. Check whether your suppliers’ states participate before relying on these alternatives. Some states still require their own forms.
Why Suppliers Reject Certificates
Even with a valid Form ST-5, suppliers sometimes refuse to accept it:
- Incomplete information: Missing signature, business name, or tax ID
- Failed verification: Your Georgia tax number doesn’t validate in the state system
- Suspicious purchases: Items don’t align with your stated business type
- Out-of-state certificate: Supplier’s state doesn’t accept Georgia forms
- Expired permit: Your underlying sales tax permit lapsed
Call suppliers before large purchases to confirm they’ll accept your certificate. Nothing’s worse than discovering problems when you’re ready to buy.
Let HOST Handle the Details
Managing resale certificates across multiple vendors and states gets complicated fast. Hands Off Sales Tax takes that burden off your plate entirely.
ResaleCertify: Automated Certificate Management
HOST’s ResaleCertify platform streamlines everything:
- Generate state-compliant certificates instantly
- Store and organize certificates for easy access
- Automate renewal tracking to prevent lapses
Sign up, add your business information, and download dynamically generated certificates ready to use immediately.
Beyond Certificates
HOST provides comprehensive sales tax solutions:
- Sales Tax Registration & Filings: Accurate, timely filings across all jurisdictions
- Nexus Analysis: Identify exactly where you have tax obligations
- Audit Defense: Expert representation when states come calling
With HOST managing your sales tax complexities, you focus on growth instead of compliance.
Your Next Steps
Getting a Georgia resale certificate involves registering for a Sales and Use Tax Number, completing Form ST-5, and maintaining accurate records. Follow those steps correctly, and you’ll avoid penalties while keeping more cash in your business.
But if you’re managing sales tax across multiple states, professional help makes sense. Hands Off Sales Tax handles everything from ResaleCertify to audit defense and multi-state compliance.
Contact HOST today for expert guidance and hassle-free tax solutions.
Frequently Asked Questions
What’s the difference between a resale certificate and a sales tax permit?
A sales tax permit authorizes collecting tax from customers on taxable sales. A resale certificate (Form ST-5) lets you purchase goods tax-free from suppliers when buying for resale. You need the permit before using the certificate.
How fast can I get my Georgia Sales and Use Tax Number?
Registration through the Georgia Tax Center typically issues your number within 15 minutes via email. The entire process happens online and moves quickly.
Do Georgia resale certificates expire?
Form ST-5 doesn’t have an expiration date, but it’s only valid while your Georgia Sales Tax Permit remains active. If your permit gets revoked or becomes inactive, your certificate becomes invalid.
What happens if I use my resale certificate incorrectly?
Penalties reach 5% monthly up to 25% of tax due, plus 1% monthly interest. Serious misuse triggers audits, criminal charges, or business license revocation.
Can out-of-state businesses use their resale certificates in Georgia?
It depends on reciprocity agreements between states. Without a reciprocal agreement, Georgia suppliers can’t accept your out-of-state certificate. You’d need a Georgia sales tax permit and Form ST-5.
How long should sellers keep resale certificates?
Industry best practice recommends at least three years, aligning with standard business record retention. Keep certificates available for Georgia Department of Revenue audits.
What information must Form ST-5 include?
Valid certificates include: supplier name and address, your business name and address, Georgia Sales and Use Tax Number, business activity description, reason for exemption (checked box), and your signature under penalty of perjury.
How does HOST’s ResaleCertify help with certificate management?
ResaleCertify automates the entire process, generating state-compliant certificates, tracking renewals, and organizing documentation. You never miss expiration dates and always have audit-ready records.
