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Illinois Licensed Plumbing Contractor
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Discussion Starter · #1 ·
Just getting my business up and going and my accountant said I need to be charging sales tax on t&m jobs where i mark up material? Only way around this I see is flat rate pricing where i don't break down materials cost the final t&m ticket? I was under the impression that the sales tax paid at time of purchase was all that was required? Good things I have an accountant, the bookkeeping side is confusing. Appreciate any info, thanks!
 

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philosopher and statesmen
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8,355 Posts
I pay my sales tax on everything and just absorb it into the cost of doing business
I always tell everyone the price I am giving them is including the sales tax which keeps me
from having to do the insane amount of bookwork involved and also having to send the money to
the government monthly .... more make work for the bookkeeper

I was told by my book-keeper that as long as I dont write anything down on their invoice showing you
charged them sales tax then you are ok.... just one lump sum for services rendered...

I had to go down the the state house years ago and fill out some forms stating that I was not
collecting the sales tax from the customers and just paying it myself......I believe that this saved
me a shi/load of headaches and greif
 

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plumbing accounting is confusing. im from wisconsin. i am not tax exempt. meaning i pay tax on materials when i buy them. if i repair a faucet, i have to charge tax on labor and materials. if i replace a faucet, no tax. real property. now you are probably more confused.
 

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plumbing accounting is confusing. im from wisconsin. i am not tax exempt. meaning i pay tax on materials when i buy them. if i repair a faucet, i have to charge tax on labor and materials. if i replace a faucet, no tax. real property. now you are probably more confused.
Do you itemize whatever tax on your customers' invoices? Do they complain or ask questions about it?
I'm not confused, I simply know that tax laws are written to facillitate governments' getting money.
 

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philosopher and statesmen
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Do you itemize whatever tax on your customers' invoices? Do they complain or ask questions about it?
I'm not confused, I simply know that tax laws are written to facillitate governments' getting money.

I just threw a water hater in this afternoon..... the total bill was 1899 installed....
that included a therm tank, a few fittings and a water heater.....nothing mentioned on
the invoice about tax and nothing was itemized

the only thing written on my bill was the warranty on the tank, parts and labor...
and the date of the installation.
that is all anyone needs to know..... hee haw
 

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Illinois Licensed Plumbing Contractor
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Discussion Starter · #8 ·
I just threw a water hater in this afternoon..... the total bill was 1899 installed....
that included a therm tank, a few fittings and a water heater.....nothing mentioned on
the invoice about tax and nothing was itemized

the only thing written on my bill was the warranty on the tank, parts and labor...
and the date of the installation.
that is all anyone needs to know..... hee haw
This is how I’m starting to do My invoices. Simple and to the point, no itemizing.
 

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philosopher and statesmen
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8,355 Posts
Example in Ontario Canada:

labour- $180
+
Materials- $20
=
Sub total $200
x
HST- 13% (or .13) $26
=
Total $226

At least in our state you cannot charge sales tax on the labor ,
only on the materials--- maybe in Ontario its ok I dont know

I used to get called out once in a while doing it this way....
occasionally someone would know the tax laws and cry foul on me for taxing them on the labor
and I would have to back peddle and of course THEN they would want to know
the cost of my water heater or materials that I was passing that pesky tax onto them...

your sub total that you can collect tax on should be only 20 dollars not 260...


this is exactly why I dont itemize anything....
and just throw them one lump sum at them
I dont see any reason to tell them what the materials
or water heater cost me...
 
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