I have a client that is a Texas agricultural farmer as he raises koi fish for a living. This past month, I billed my cleint the services I offer + sales tax. Well the other day, I receive a phone call from my client saying he generally does not pay sales tax because hes a agricultural farmer. However, hes willing to pay the sales tax if need to. He told me to look into it and let him know. So what do yall think?
There may be some exclusions under Texas law for agricultural items purchased. There are for sure in Kentucky. I doubt you were selling agricultural items. Maybe if it related to the farm it would be. Do you guys have a service sales tax?
Yea, I don't see how custom web design, custom logos, custom banners, hosting, ect... has to do with agricultural items.... lol!!!! To be honest with you, I am not sure if there is a service sales tax in Texas. Where would I go to find out?
I would suspect that the laws where you are located would apply if any do. If you aren't in Texas why did you charge sales tax in the first place? Most states do not require a sales tax to be collected unless you have a presence in the state the shipment was made to. Out of state sales are not subject to tax. If you have a tax number for sales tax collection you should be familar with the laws of that agency.
start here: http://www.window.state.tx.us/taxinfo/taxforms/01-forms.html EDIT: Being curious I also found this: http://www.window.state.tx.us/taxinfo/taxpubs/tx96_259.html
I am not a CPA in your state nor do I perform tax services as a CPA in my state. But it appears to me that you need to charge sales tax on website creation services in Texas. Taxable Services per Texas website "A Texas business that provides a taxable service for a fee is required to obtain a sales tax permit and collect the state and local sales tax. Listed below are some types of services that are taxable: <snipped some inapplicable sections> Data processing Using a computer for word processing, data entry, data production, or compilation, storage, and manipulation of information. Examples of data processing include check preparation, accounts payable or receivable preparation, and web site creation, storage and maintenance. Merely using a computer as a tool to help perform a professional service is not a data processing service." You should check with a CPA, or similarly qualified tax expert, in Texas about how to register and pay the taxes. Tom
If you have a local tax office call them otherwise call Austin directly 1-800-252-5555 ... Here is information on Ag exemption from sales tax: http://www.window.state.tx.us/taxinfo/taxpubs/tx94_101.html If he is exempt, the onus is on him to complete the tax exemption form and provide it to you: http://www.window.state.tx.us/taxinfo/taxforms/01-3392.pdf
Thanks guys... I called my local tax office and they refer me to a state tax phone number. I call it and they said I would tax my client.