Do you charge customers sales tax? Florida

[Jeff Wagner]

I just met with an accountant and asked her if i should be charging my customers sales tax. She googled it and said if its just a wash no. But if you compound, polish, or wax the car then yes i have to charge them sales tax. Can any florida detailers tell me what you do?

[Sizzle Chest]

January 5, 1999|By Harry Wessel of The Sentinel Staff

QUESTION: Isn't it true that there is no Florida sales tax on labor?

ANSWER: It depends. Under Florida's sales and use tax, if no parts were used in the service and the charge was for labor only, then there would be no tax to pay. But if any parts were used in the service work, the store must charge sales tax on the entire bill.

http://dor.myflorida.com/dor/forms/current/gt800010.pdf


A grey area...I was always told that you don't charge for labor...only if parts/etc are supplied. I don't count detailing supplies as parts...

Hope this helps!

[jarred767]

Your accountant used the terms compound and polish? I hope you gave her a card.

I'm in Washington state, but I have to charge sales tax on all jobs. And it has to be reported to the city I do the work in; being mobile, that means I file taxes at the end of the year to 15-20 different cities :bash:

[Jeff Wagner]

Sizzle i am a little confused about your answer it depend and a grey area. The form is also kinda crazy but i am guessing in a way your answer is no you dont charge sales tax.

Jarred lol she was reading a google search and yes i gave her a card. She said pretty much what your doing. Go to fla dept of revenue and register for sales & use tax. Also to get a tax exempt certificate so i dont have to pay taxes on products or tools purchased for the business.

This is the fla dept of revenue link
FL Dept Rev - Registration and Account Maintenance (http://dor.myflorida.com/dor/taxes/registration.html)

Line 3 says this (Repair or alteration of tangible personal property)

My business is new and I just dont want to owe back taxes after years of being in business from an audit.

I think i just found the answer and it is YES you should be charging your customers sales tax. You could owe big time if you have been in business for some time and get audited.
Here is a link to the answer after i did a q&a on there website
https://askdor.state.fl.us/FAQ/FAQDetails.aspx?ID=5

y > Subcategory
General Tax > Sales & Use Tax

Question
Should sales tax be charged on a car wash?

Answer

Plain soap and water cleanings are not subject to sales tax. However, when the wash includes added substances such as wax, protective coatings and other coatings the entire charge for the car wash is subject to sales tax.

Reference: Rule 12A-1.006(16), Florida Administrative Code.

I bet this is what she was reading to me. Sorry to answer my own question but maybe this will help some others in Florida.

[Sizzle Chest]

Jeff: thanks for digging deeper on this. Appreciate you finding that and posting.

[jarred767]

My business is new and I just dont want to owe back taxes after years of being in business from an audit.

I think i just found the answer and it is YES you should be charging your customers sales tax. You could owe big time if you have been in business for some time and get audited.


It's wise that you're doing the research now and digging to the bottom of it. When I started my business I was told by someone at my local dept of revenue that I did not need to collect sales tax. Well I got to the end of the year and was filing and they told me that actually I was supposed to collecting. I had to figure out how much I should have collected, and still owed that, but out of my own pocket as I couldn't go back to each customer from the whole year. I'm glad it got sorted out that first year though.

Good luck with the new business and everything, I hope it goes well for you!:xyxthumbs: