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do all of you charge sales tax

Discussion in 'Starting a Lawn Care Business' started by tsi guy, Jan 25, 2008.

  1. tsi guy

    tsi guy LawnSite Member
    Messages: 41

    I went down and registered with the city for a service vendors license and they said I had to collect sales tax from my customers. all I would like to do is just pay my income tax on what I earn for the year. they say I have to file twice a year and send them there money. Is there any way around not collecting sales tax?
  2. Raven386

    Raven386 LawnSite Silver Member
    from CT
    Messages: 2,169

    dont own your own business. go work with another LCO

    BUCKEYE MOWING LawnSite Bronze Member
    Messages: 1,169

    So....you want to avoid paying taxes ?? BE LEGIT !! you got a vendors license...now do it right...
  4. RGM

    RGM LawnSite Senior Member
    Male, from Baltimore Md
    Messages: 979

    i don't charge a sales tax because i have all ready paid it when i bought the materials the tax man gets enough
  5. gandk06

    gandk06 LawnSite Senior Member
    Messages: 509

    sales tax does not cost you any money. It cost your customers money. how hard is it to tack it on the bill and send in a check 4 times a year?
  6. RGM

    RGM LawnSite Senior Member
    Male, from Baltimore Md
    Messages: 979

    well in my state you don't tax lawn services so i pay the tax for materials i buy and charge for the service i provide
  7. SpruceLandscape

    SpruceLandscape LawnSite Senior Member
    from ohio
    Messages: 502

    Ohio has a sales tax specifically for the service industry. Even if you don't resell a single item, you must pay sales tax on your service charges. Go to the ohio business gateway. All the info you need is on their website, including a complete list of industries that must pay sales tax, along with the forms you need to print out and send it to get your license numbers if you don't already have them (which I am assuming you don't). Depending on how much taxable sales etc. will determine how often you have to file each year. If you are small, then it will probably only be twice a year. The larger you get you will work towards a monthly payment plan with the state. They will also send you a list of sales tax rates and updates for when tax rates change.
    I was just hit recently when they changed cuyahoga from 7.5% to 7.75% in October. Its not really that big of a deal, but it can get annoying when you do business in more than one county. If you use Quickbooks software or similar billing software, all the sales tax issues should be built right in and it makes it a breeze. You can either charge sales tax, keep track of how much you collected, or just pay it out of your pocket as long as you build in a margin when you are pricing/bidding on things so that it doesn't hit you too hard in the pocket book. Let me know if you have any other questions.
  8. tsi guy

    tsi guy LawnSite Member
    Messages: 41

    thanks spruce. I have no problem paying my taxes but it's a pain in the rear collecting for the man. They should collect there own. And in a cut throat business a few dollars seperate most of the lco. consumers are looking for the better deal especialy with the economy take a dump. but I was just wondering if there was a way around it. I quess not
  9. Roger

    Roger LawnSite Fanatic
    Messages: 5,943

    Your use of the word "charge" is an indicator that you are unclear about the system. If your services are to be taxable with regard to sales tax then, other services that YOU buy, or products that you buy, have a sales tax too. You pay the tax when you buy the service or product.

    As the contractor providing the service, you are not CHARGING a sales tax, you are the COLLECTOR of the tax. Your job is to collect the tax as the law requires, and remit the collected monies to the appropriate agency. Usually, the agency is a state taxation body, but you seemed to be in a situation where a local sales tax is to be collected. It costs you the time required to write the check twice per year (as per your statement). It does not cost you any out-of-pocket money. You can argue that it costs you time to cut the check twice per year, and for that effort, you are not reimbursed. But, the retailer where you might pay your sales tax, or the contractor providing a taxable service to you, does not get paid for their effort either. The monies are merely passing through your hands, and you don't get a dime for your work.

    You seemed concerned that people will not want to pay it, or it will make your service too expensive. Apart from somebody operating illegally, you are not at a competitive disadvantage from any other contractor providing the same lawn service.

    But, remember, you are not charging a sales tax, you are collecting one. There is a big difference.
  10. DLAWNS

    DLAWNS LawnSite Fanatic
    Messages: 5,780

    I charge sales tax. Its a necessary evil. It's no big deal really.

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