Sales Tax on Detail Jobs

[Corona]

Just wandering if most of you charge sales tax to your detail jobs. When I was in the process of getting my Business License at the DMV...they told me that I didn't need to charge Sales Tax because I was providing a service....locally I hear that some do and some dont?

[ClearlyCoated]

Re: Sales Tax on Detail Jobs

Legally and ethically you only charge sales tax with the intention of paying that tax to the state. The DMV was right. Generally sales tax is applied to goods, not services. For instance, if you ever checked your mechanic's bill, you will see tax applied only to parts, not labor. Sales tax can also be applied to goods (such as food) that are prepared for immediate consumption, which is why you pay sales tax on restauarant bills or food you buy from fast food or deli places.

[Deaner5]

Re: Sales Tax on Detail Jobs

One thing is to stay up current law since recent budget deficits for states have many considering where to get move revenues (taxes) from. In Minnesota, they were considering adding sales tax to professional services (legal, accounting, and other things). I think MN is facing a 5-7 billion dollar shortfall for their 2012-2013 cycle.

I can't imagine how CA is doing. I don't want to make this political, just reminding us some of the hardships our states are facing and how it might effect detailers out there in the future.

[cnfowler]

Re: Sales Tax on Detail Jobs

ClearlyCoated is correct. Sales tax on goods only, not services. Unless you are selling detailing supplies or products, you won't have to charge sales tax.

Of course, always check your local laws first (which you've already done).

Colin

[Corona]

Re: Sales Tax on Detail Jobs

Thanks so much for all your input.....