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How do I know if my service is taxable?

I've just started a business and I am entering my data for quickbooks. Its asking if I want sales tax added to the prices of my service.

How do I know if I should? What does charging a customer sales tax do? What if I dont charge the sales tax, will I owe extra at the end of the year?

I dont sell a particular product, I sell my services...


Asked by Anonymous at 2:02 PM on Feb. 23, 2010 in Money & Work

This question is closed.
Answers (3)
  • If your are selling a service then no you don't charge tax, if you are selling a good (retail or wholesale) then yes charge sales tax. You only charge tax if your state requires you to pay in the sales tax. My DH provides a service, so he is not required to charge pay in sales tax (to the state) (every state has sales tax)

    Answer by southernstyle88 at 3:12 PM on Feb. 23, 2010

  • From what I understand if the state you live in has Sales Tax then you would want to charge it.
    You will need a tax id from your state to remit the sales tax you collect.

    If you provide a service to a client who is also a business they can provide you their tax id and then you wouldn't charge them the sales tax.

    Answer by AussieMum2 at 2:07 PM on Feb. 23, 2010

  • sorry, I was typing too fast, I know the last sentence doesn't make sence LOL
    If you have any other questions or want to chat let me know, I do taxes and am studying accounting and bookkeeping.

    Answer by southernstyle88 at 3:14 PM on Feb. 23, 2010