Good question and the answer is . . . . . at the time of the transaction.
For example, you did a repair but you’re allowing them to pay in installments – tax is due the signing day of the contract or the day of the verbal agreement. You sell retail and allow your customers layaway options – tax is due the time the items are put on layaway.
And it’s the FULL tax that is due upfront, even if you haven’t collected all the money from your customer.
So if you have a $100 service in a 6% county and you allowed your customers to pay the balance in $25 installments, sales tax in the amount of $6 is due the day the contract is signed, not when the service is paid in full.
This tricks a lot of people up because they always question ‘how am I to pay taxes on funds I haven’t received?’ Good question, but that’s not given any consideration when it comes to the law. You can read the upfront sales tax requirement clear as day here under 12A-1.056(1)(a), F.A.C.
First, let’s look at FDOR’s definition of a service warranty which also goes by the name of maintenance contract: ‘Any contract or agreement that indemnifies the holder of the contract or agreement for the cost of maintaining, repairing, or replacing tangible personal property.’
Service warranties are taxable, but they are not taxed when it covers an item that is not subject to tax. For example:
Taxable: A service warranty for a car is taxable since cars are taxable.
Not taxable: A service warranty for a hearing aid is not taxable since hearing aids are not taxable.
When a service or replacement is made under a warranty, the payment made by the service warranty issuer to the person making the repairs is not subject to tax. However, any payments made by anyone else besides the service warranty issuer are taxable. For example:
A customer comes to you for repairs to his car. The total charge for the repair is $3,000.00. The taxpayer will be using his service warranty to cover the repairs but has a deductible of $1,000.00. The $1,000.00 paid by the customer is taxable; the remaining $2,000.00 paid by the service warranty issuer is not taxable.
You can read more about service warranties here under 12A-1.105, F.A.C.
Get it? Got it? Good! Cheers!
FDOR doesn’t require sales tax to be collected and remitted for online services (excluding detective, burglar protection, and other protection services – these are still taxed even if it’s online monitoring) . . . yea, that’s pretty much it for this question. Cheers!
The charge to paint a building is exempt from sales tax. If your charge includes the material and the labor, the entire charge is exempt from tax. But, if you have one invoice for the labor and a separate invoice for the paint – the labor is exempt from sales tax but you will need to collect and remit sales tax for the paint.
The painting of a building is considered improvement to real property which is exempt from sales tax. You can read more about real property improvements here.
This one is pretty straight forward:
As it pertains to this article, we’ll define non-profit organizations as organizations that currently hold a valid/active Consumer’s Certificate of Exemption (Form DR-14) issued by the Florida Department of Revenue. These are usually issued to most schools, governments, 501(c)(3) organizations, and etc. You can review the various categories here.
Sales: Non-profit organizations must collect sales tax on their sales.
Purchases: Non-profit organizations are not required to pay sales and use tax on their purchases.
*Exception: Religious institutions and their affiliates (think of a church running a thrift store) and the federal government are exempt from charging sales tax on their sales. They are exempted both ways – exempted from charging sales tax and exempted from paying sales and use tax.
You can read more about sales and use tax exemptions for non-profit organizations at the FDOR’s site here.
Good question, especially if you’re ever audited *gasp* and any of the below will work as proof that you shipped your sales out of Florida:
- Internal delivery orders listing item(s) sold, mailing address, and delivery date (with proof of expenses due to the delivery i.e. trip tickets signed by the person who delivers the item).
- United States Postal Service parcel post receipts with supporting documentation listing the item(s) and mailing address
- Common carriers’ receipts, bills of lading, or other proof of mailing address
- Export declaration
- Receipts from a licensed customs broker
- Proof of export signed by a customs officer.
You can read more about proof of shipping out of state (aka exports) here, under 12A-1.0015(2)(c), F.A.C.
Florida does not have a state individual/personal income tax and thank God for that!