How to Close or Cancel a California Seller’s Permit

To close or cancel a California seller’s permit, notify the California Department of Tax and Fee Administration (CDTFA) through its Online Services system or, if you do not have online access, submit Form CDTFA-65, Notice of Closeout. You must also file the required final sales and use tax return, submit any missing prior returns, pay outstanding amounts, and provide information needed to complete the closeout.

Request closure when the business stops operating, is sold, changes its form of ownership, or is no longer engaged in taxable activities. Do not close the account merely because sales have slowed or paused if you expect to make additional taxable sales.

When a California seller’s permit should be closed

Closing a seller’s permit is appropriate when the permit holder’s taxable business activity has ended under the existing account. Common reasons include:

• The business has permanently stopped operating.
• The business has been sold.
• The business has changed its form of ownership.
• The business is no longer engaged in taxable activities.

A change in ownership form matters because the existing permit is tied to the current account holder and business circumstances. When a successor or differently organized business will continue making taxable retail sales, the new operator should determine whether a new permit is required. For background on setting up the replacement account, see California Seller’s Permit Requirements for New Retail Businesses.

Timing also matters. A retailer remains liable for tax on taxable sales made after its account closes and must notify CDTFA for reporting instructions. If additional taxable sales are anticipated, the account should not be closed yet. This can be relevant when the storefront has shut down but inventory, equipment, or other taxable property will still be sold.

Information and filings needed for closure

Closing the permit involves more than sending a notice that the business has ended. CDTFA may need details that establish what happened to the business, its inventory, and its assets. Depending on the circumstances, be prepared to provide:

• The effective closure date and reason for closing.
• Information about the disposition of inventory and business assets.
• The purchase price of inventory retained by the owner.
• Current contact information for the permit holder.
• The location where business records will be kept.
• Buyer information and details of the sale if the business was transferred.

The effective date should reflect when taxable operations under the account actually ended. Before starting the closeout, reconcile sales records, inventory records, asset-sale documents, and prior return filings. This makes it easier to provide consistent information on the closure request and final return.

The permit holder must file the final return and every unfiled prior return and pay all outstanding amounts. If the account is already required to make payments by electronic funds transfer (EFT), the final payments must also be made through EFT.

The final return must include sales through the closeout date. It must also account for relevant sales of furniture, fixtures, or equipment. If inventory purchased without tax is retained for personal use, the applicable tax on that retained inventory must be reported as well.

How to close the seller’s permit

Option 1: Use CDTFA Online Services

If you have login credentials and access to the account, sign in to CDTFA Online Services and follow these steps:

1. Select the account you intend to close.
2. Choose “More” under the “I Want To” section.
3. Select “Account Closure” under Account Maintenance.
4. Enter the requested closure information and review it for accuracy before submitting.

Use the correct account, particularly if the login provides access to multiple tax or fee accounts. Keep a copy or confirmation of the information submitted with the business’s tax records.

Option 2: Submit CDTFA-65

A permit holder who does not have access to Online Services may complete Form CDTFA-65, Notice of Closeout. The completed form and supporting documents may be mailed to:

California Department of Tax and Fee Administration
Customer Service Center
PO Box 942879
Sacramento, CA 94279-0090

Follow the form’s instructions and include applicable details about the closure, inventory, assets, records, and any transfer of the business. CDTFA may request additional information before completing its review and closing the account, so keep the listed contact information current and monitor correspondence after submission.

Complete the final return and payment obligations

Submitting an account-closure request does not replace the final return. The deadline depends on the account’s filing frequency. Monthly and quarterly filers may normally file their final return on the regular due date. Annual filers must file by the quarterly-return due date for the quarter in which the account closes.

Review the final reporting period carefully. It should cover taxable activity through the closeout date and any reportable disposition of business property. Resolve missing prior returns and outstanding balances rather than treating the closure request as a substitute for them.

Practical mistakes to avoid

Closing while taxable sales are still expected

Do not select a closeout date simply because a location has closed or normal operations have stopped. If the business still expects taxable sales, including a final round of sales after the proposed closure date, keep the account open for the necessary reporting. Tax liability can continue for taxable sales made after closure, and CDTFA must be contacted for reporting instructions if such sales occur.

Leaving asset or inventory transactions off the final return

Owners may focus on ordinary customer sales and overlook the final disposition of store property. Check whether furniture, fixtures, or equipment were sold and whether untaxed inventory was retained for personal use. Where these events occurred, the relevant transactions belong on the final return.

Assuming the closure request clears unfinished filings

An account closure does not erase unfiled returns or unpaid amounts. Review the account history before submitting the closeout so that the final return, prior missing returns, and required payments can be addressed. Required EFT payers should continue using EFT for final payments.

Using incomplete sale or ownership-change details

If the business was sold or transferred, gather the buyer’s information and sale details before filing the closure request. Clearly distinguish the final activity of the former operator from the activity of the new operator. If you need to confirm permit information associated with a transaction, read How to Verify a California Seller’s Permit Number.

Discarding records after the account closes

Business records must be retained for four years after the account closes. Organize the closure confirmation, final and prior returns, payment records, sales documentation, inventory records, asset-disposition records, and business-sale documents so they remain accessible. The records-location information supplied during closeout should remain accurate.

What to do after submitting the closure

Keep evidence of the online request or a copy of the mailed CDTFA-65 and its supporting documents. Watch for requests for additional information, particularly where the business was sold, inventory was retained, assets were disposed of, or the reported closure date requires clarification.

Confirm that all required return periods have been handled and that the final return covers activity through the chosen closeout date. Retain proof of final payments, including EFT records where the account was subject to the EFT requirement.

If a different owner or newly organized entity will continue taxable operations, treat its permit needs separately from the former owner’s closeout. The continuing business can review How to Apply for a Seller’s Permit in California. Keeping the old account’s closure records separate from the new operator’s registration and sales records helps establish which entity conducted each period of activity.