Tax question?Should i add a sales tax?
- Thread starter zappy
- Start date
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ptonsparky
Tom
- Occupation
- EC - retired
Are you required to collect sales tax by your state?
gra electric
Member
- Location
- whitney point, NY
I am not sure if this is correct for your state, but in NY an electrician only needs to collect sales tax on tangible items if it is service work. For example changing out a ballast. If you repair existing equipment its considered service work. If you install anything new or used it is considered a capital improvement. Hope this helps.
Gerry
Gerry
bradleyelectric
Senior Member
- Location
- forest hill, md
A very good accountant is invaluable. Who does your income taxes?
tonyou812
Senior Member
- Location
- North New Jersey
Dont you already pay sales tax when you buy the Material? why would you pay it twice?
gra electric
Member
- Location
- whitney point, NY
tonyou812 said:
He talking about a service or USE tax. In NY certain service type work is required to pay taxes on the labor end too. Auto shops, furnace or boiler repairs, painting of an existing structure, etc. Anything that is not considered a "capital improvement" is considered service work and the labor is subject to sales tax. I think that's what the op was asking?
Gerry
Sierrasparky
Senior Member
- Location
- USA
- Occupation
- Electrician ,contractor
Tax is collected in Ca if you charge time and materials. Tax is only added to the materials if it is marked up or if no tax was paid when you purchased it. There is no tax on service work if you charge a job price.
Once you itemize and mark it up you need to pay the sales tax.
Once you itemize and mark it up you need to pay the sales tax.
You mark up the materials so the tax increases.
In AZ, contractors don't pay sales tax on materials at point of purchase.
For T and M work, we charge the customer 8 point something percent on materials only. On contract work, the state set 35% as material cost so we bill accordingly.
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