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tax sub-contractor

Discussion in 'Business Operations' started by grass disaster, Feb 13, 2006.

  1. grass disaster

    grass disaster LawnSite Silver Member
    Posts: 2,583

    is it true that the state tax is collected by the sub-contractor?


    lets say that i am hired by someone to cut a lawn the sub contractor charges $30 dollars and pays me $20.

    i only bill for the $20 no tax

    he charges the $30 plus the tax
  2. kickin sum grass

    kickin sum grass LawnSite Senior Member
    Posts: 628

    the sales tax is collected by the final person billing for the service. Or in another words is paid by the end user which is the person receiving the service/goods.
  3. mastercare

    mastercare LawnSite Senior Member
    Posts: 289

    IT looks like you have the roles of contractors and subcontractors confused.

    The contractor is the person selling the service and also the one who takes care of all invoicing.

    If that contractor is hiring someone else to do the work, the hired help becomes the sub-contractor. The sub-contractor does no invoicing whatsoever. He just performs the work he's asked to do, and the contractor he works for pays him a price for the work he completed. Usually if you're a sub, you're working "under the name of" XYZ company when you're doing your work. Subs have no invoicing or taxing requirements.....that's the job of the contractor (company who sells the service).

    Hope this clears up some things.

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