Services in Florida are generally not taxable. However, if the service you offer includes the creation or repair of a product, you may have to pay sales tax on the products. Tangible products are taxable in Florida, with some exceptions. The state of Florida does not usually collect sales tax on the vast majority of services provided.
An example of taxed services would be crime investigation and protection services, non-residential indoor cleaning services, non-residential pest control services, or one that includes the repair or creation of a product. This means that a yoga instructor would not be required to collect sales tax, whereas a private investigator may be required to collect sales tax. Goods that are subject to sales tax in Florida include physical goods, such as furniture, appliances, and motor vehicles. A business that sells or leases property or services tax-free must document each tax-exempt sale when the property or service is resold or rented again, obtaining a copy of the customer's certificate or an authorization number issued by the Department.
Businesses can apply the rounding algorithm to the total amount of tax calculated on all taxable elements of an invoice or to the taxable amount of each individual element of the invoice. Taxation for various transactions (such as services and shipping) may vary from state to state, as can policies on issues such as whether excise taxes or installation fees included in the purchase price are also subject to sales tax. Whether your company provides or even purchases one of the designated taxable services or one of the other indirect taxable services, you need to ensure that you are aware of your obligations from a tax perspective. However, the service provider considers itself a real estate contractor and is “required to pay sales and use tax on its purchases of materials, supplies, parts and any other taxable items used in the repair.
Recently, for example, a Florida business owner wondered if non-residential hood cleaning services are taxable or exempt. When necessary, the company “will also perform repairs or modifications to the hood system during a cleaning service. Non-residential building cleaning service, a category that includes public accommodation establishments as defined by the North American Industrial Classification System, is generally subject to sales tax. All expenses necessary for the provision of the service are included in the amount of taxable sales.
Sales tax is added to the price of taxable goods or services and is charged to the buyer at the time of sale. Determining if the products or services your business sells are taxable in Florida is the first step to complying with sales taxes. Unfortunately, because services are less commonly known to be subject to sales tax, many taxpayers are affected by audits for not taxing these services. The additional county rate applies to a taxable item or service delivered in a county that imposes an overtax.
It's important to understand the tax consequences of both the taxable services and the taxable products you sell to your customers. The State of Florida does not require businesses to collect sales taxes for the sale of digital goods or services. .