I purchased products from Partylite a company that sells candles and other decorative products. The consultant added the shipping and handling to my subtotal and charged me sales tax. Is this even legal?
2007-01-22 10:26:53 · 6 answers · asked by Iam5150 1 in Business & Finance ➔ Taxes ➔ Other - Taxes
No but companies still do it. I had a company charge sales tax on delivery - again that's wrong. There is no sales tax on labor.
Don't listen to "jseah11" - he doesn't know what he's talking about. I've done sales tax returns for 15 years and dealt with a State Board of Equalization audit.
2007-01-22 10:34:33 · answer #1 · answered by Dizney 5 · 0⤊ 2⤋
Think you are getting at least one bad answer and a couple of good efforts.
In California shipping charges are sometimes taxable even if separately stated. Tax is charged because retailers can not design a invoicing system that will meet the California Board of Equalization's invoice matching requirements. For shipping charges to be exempt from California's sales tax, the retailer is required on a transaction by transaction basis to match what they charged to the actual cost they incurred. Average shipping charges cannot be used. Unless the retailer can refer back to the actual shipper's invoice for that transaction AND the retailer does not charge anything over that amount, shipping charges are subject to California's sales tax.
Before anyone says I am way off base please review the BOE's publication noted below.
2007-01-23 09:14:26 · answer #2 · answered by zudmelrose 4 · 0⤊ 0⤋
To collect sales tax a company must have a permit to do so. First you are assuming that the company does not have sales tax nexus in your state, however this is irrelevant to your question since the company is acting as an agent on behalf of your state by collecting sales tax which can also be voluntary (especially common in the streamlined agreement states) Presuming that the product qualifies as taxable property, the burden is on you, the purchaser to prove to the seller that you are exempt from tax by providing valid exemption/resale documentation in your state. Even if the company did not charge you tax and you are the end consumer of a taxable purchase, you must pay use tax to your state. Disclaimer: The above information is not intended as tax advice and should not be used for any purpose.
2016-05-23 22:54:09 · answer #3 · answered by Anonymous · 0⤊ 1⤋
Handling charges are taxable in California for purposes of the sale tax. Shipping charges are not, however, the shipping charges must be separately, and clearly, stated on the invoice. If it is not, then delivery charges are taxable. Also, the delivery has to be made by a common carrier, a third party company that the seller uses, such as UPS, Fedex, etc. If the seller makes the delivery themselves (they deliver using their truck), then the delivery charge is taxable.
2007-01-22 10:44:37 · answer #4 · answered by jseah114 6 · 1⤊ 1⤋
I think that I researched this a couple of years ago.
Calfornia does not tax the shipping charge assuming that shipper does not mark up the shipping. However, if the shipper marks up the shipping as most do, the difference between their cost and what they charge you should be subject to tax. Unfortunately, most accounting systems aren't designed to handle this so the shipper usually just taxes the whole thing.
2007-01-22 10:59:45 · answer #5 · answered by Wayne Z 7 · 2⤊ 0⤋
How about getting some up to date information
2016-04-17 10:36:06 · answer #6 · answered by Don 1 · 0⤊ 0⤋