We provide services. We pay sales tax on all the material we purchase. Do we then charge the customer sales tax?

Response by Diane Yetter    August 16, 2011

Full Question: We provide Commercial Concrete Repair and Restoration services. We pay sales tax on all the material we purchase, do we then turn around and charge the customer sales tax?

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Answer:

Diane YetterAssuming the concrete repair and restoration services you provide are to real property and not to tangible property (movable property), then you are deemed a contractor in SC. Contractors pay tax on the materials they purchase either for incorporation into real property as part of a contract or that they use or consume in providing their services. In these service contracts, you should not charge sales tax on the invoice to the customer. If you sell concrete without a service, then you are a retailer and you should not pay tax on your materials but rather charge sales tax on your selling prices.

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