Sales Tax Issues

[bbrownatl]

Alright, I’m in need of some sales tax insight. I have a client (C-Corp) that purchases certain devices of which they use as part of maintenance services that they provide. They pay sales tax on purchase of the devices but they don’t charge clients sales tax since they are selling a service (maintenance) which includes the replacement of devices on an as needed basis.

Any need to charge sales tax here?

How about the case where they buy the devices from out of state where they don’t pay any sales tax?

Any insight appreciated.

Thanks,
Brian

[Larmil]

Alright, I’m in need of some sales tax insight. I have a client (C-Corp) that purchases certain devices of which they use as part of maintenance services that they provide. They pay sales tax on purchase of the devices but they don’t charge clients sales tax since they are selling a service (maintenance) which includes the replacement of devices on an as needed basis.

Any need to charge sales tax here?

How about the case where they buy the devices from out of state where they don’t pay any sales tax?

Any insight appreciated.

Thanks,
Brian

If the client is in GA you might contact https://etax.dor.ga.gov/. Each state has different laws.

[ChEAr$]

Alright, I’m in need of some sales tax insight. I have a client (C-Corp) that purchases certain devices of which they use as part of maintenance services that they provide. They pay sales tax on purchase of the devices but they don’t charge clients sales tax since they are selling a service (maintenance) which includes the replacement of devices on an as needed basis.

Any need to charge sales tax here?

How about the case where they buy the devices from out of state where they don’t pay any sales tax?

You're on the right track in first paragraph. Thank God Georgia doesn't have a sales
tax on services! (yet)

When they buy personal property from out of state the use tax (same as sales tax)
is paid to Georgia on the monthly sales tax return. I don't have any clients these days
with Georgia sales tax returns to be done, but on the old forms there was line one
for gross sales, and line two for purchase subject to the use tax.

Look at the sales tax form to see if that's still the case.

If client is not already filing sales tax returns, there is probably a procedure for
paying the tax on a non periodic basis.