Tax on Labor?

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DriveClear
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Tax on Labor?

Post by DriveClear »

I was speaking with the accounts payable department of one of my Fleets this morning introducing myself and everything. She wanted to know if we collected and paid the DC tax. I proceeded to tell her that there is not supposed to be tax on labor & we are only charging for the labor of repairing the windshields. She told me that DC puts a tax on labor as well for certain things. This is all new to me, I worked at another company previously who did installations (of signs) and we never collected tax on our labor when we did work in DC. As a new business owner I wanted to make sure that I am doing everything correctly. Please let me know if you have any information on this, have not been able to find reliable information about this issue from other sources.
candyman
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Re: Tax on Labor?

Post by candyman »

Contact the DC Dept of revenue. Ask for a copy of the tax laws .
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screenman
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Re: Tax on Labor?

Post by screenman »

And if they are anything like ours get a professional to explain them to you. Better safe than sorry, it is extremely bad to start a business wrongly just for a bit of inquiring.
DriveClear
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Re: Tax on Labor?

Post by DriveClear »

I contacted the DC Dept of Revenue and I am waiting to hear back from them. I definitely want to make sure that everything is done correctly before we set foot in DC. Thanks for the suggestion!
Mariagilbert
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Re: Tax on Labor?

Post by Mariagilbert »

No, labor is not taxable in the state of California. Stores and businesses can tax goods but services and labor are not taxed. For example, a construction worker can charge a person tax on materials but he cannot charge tax on the labor portion of the project.
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