NYS vendor ID vs. NY tax ID

Do you need a NY sales tax ID?

Any business that sells tangible personal property or provides taxable services in New York State must register with the NY Department of Taxation and Finance and obtain a Certificate of Authority. While many services are not subject to state sales tax, certain services (such as barber and manicure services) may still be subject to local sales tax.

A Certificate of Authority enables your business to collect sales tax on taxable sales and accept most NY State sales tax exemption certificates. If you have multiple business locations, you must have a Certificate of Authority for each location.

Certificates cannot be transferred. If you change business structures (for example, from a sole proprietorship to an LLC), you must apply for a new Certificate of Authority.

A business contracted by the state may require a NY sales tax ID if they sell taxable goods or services, in addition to a NYS vendor ID and EIN.

How to register for a NY sales tax ID

You can obtain a New York sales tax ID by registering for a Certificate of Authority with the New York Department of Taxation and Finance through the state’s Business Express portal. If your business expects to make taxable sales or provide taxable services, it must register at least 20 days prior to beginning operations.

The registration process requires the following information:

• Reasons for the application
• Contact information for the business (legal name, EIN, address)
• Entity type (for example, corporation or LLC)
• Date your business will commence for sales tax purposes
• Bank account information
• License numbers (if applicable)
• Information on business contacts and responsible persons

Business contacts include officers, members, and shareholders with at least 20% ownership or profit distribution interest.

Responsible persons include individuals who have certain duties or authority related to the business, such as a tax manager, or have authority over business decisions. For more information, see the Business Contact and Responsible Person Questionnaire.

Becoming a registered vendor in New York

Becoming a New York State vendor involves a vendor responsibility determination process, in which contracting parties assess whether a vendor is qualified to receive a state contract.

Responsibility criteria

Contracting parties will assess a range of factors, including whether the vendor:

• Has the appropriate financial, organizational, and operational capacity and controls
• Has legal authority to conduct business in New York State
• Has a satisfactory record of integrity
• Has acceptable performance record on past contracts

Required documentation

As a prospective vendor, you may also be asked to provide or confirm the following:

• A New York State vendor ID
• Proof that the business is registered to do business in New York State
• Certificate of Good Standing: A certificate issued by the business entity's controlling jurisdiction indicating that the business entity is current with the filing requirements of the jurisdiction
• Proof of good faith efforts: When applicable, an effort to achieve a minority-owned business enterprise, women-owned business enterprise (M/WBE) or disadvantaged business
• Any necessary licenses and registrations
• Financial statements
• Organizational chart

How to get a NYS vendor ID

To register as a vendor in New York State, complete a form and submit it along with any other relevant information to the contracting agency. The agency will then initiate the vendor registration process on behalf of the vendor, bidder, and their subcontractors with the Office of the State Comptroller.

Once the registration is processed and approved, your business is registered to the New York State Vendor File and will receive a unique 10-digit vendor identification number (NYS vendor ID) for use on all future transactions with all New York State agencies.

Once you have your NYS vendor ID

Your NYS vendor ID gives you access to The VendRep System, where you can complete your vendor responsibility registration. By law, New York State can only award contracts to responsible vendors. If the contract is valued at more than $100,000, you must file a Vendor Responsibility Questionnaire with the state contracting entity. The questionnaire provides you with an opportunity to self-disclose any issues and provide necessary information, which the contracting entity will use as part of its determination.

Your NYS vendor ID also gives you access to the Statewide Financial Management System (SFS), an online portal where you can centrally manage transaction-related information, including submitting invoices and viewing payments.

Does a subcontractor need a NYS vendor ID?

If a subcontractor is engaged to perform part of the work and is known at the time of the contract award, the state contracting agency will conduct a separate responsibility review if the subcontract is valued at $100,000 or more.

To support this review, the subcontractor must submit a separate questionnaire using its own New York State Vendor ID, not the prime contractor's ID. If the subcontractor does not have one, the contracting agency will request a NYS Vendor ID on their behalf.

Note: A subcontractor includes any company that receives funds from a vendor to perform work on a state-awarded contract.

CT Corporation can help

Outsourcing business registration and license research, applications, management, and renewals can help you take the pressure off internal resources. By working with a full-service management provider who specializes in the efficient processing of business licenses you can free up your time to focus on starting and growing your business while ensuring you keep up with changing state and federal compliance requirements.

For more information on CT Corporation services and how we can streamline your business licensing, please contact us.