Sales Taxes and Landscape Contractors
Monday, October 14, 2013
Posted by: Gregg Robertson
HARRISBURG - PLNA recently has received several questions from landscape contractors about what is subject to sales tax and what is not. It's actually pretty straight forward - mostly.
Generally, landscape contractors must pay sales taxes on all materials and equipment used on a job. Labor is not subject to sales tax. However, you cannot itemize sales taxes that you pay on materials and equipment on the invoice you present to your customer.
For example, you have contracted to put in a paver patio for a client. You must pay the sales taxes on all of the materials and equipment used on that job: the pavers, the stone for the base, the broom that you use to sweep the sand, the vibrating compactor that you rent, etc. The sales taxes you have paid cannot be itemized on your bill. However, you can include the sales taxes as part of the markup or overhead you charge the client for the job. They just cannot be itemized on the bill.
The exception to this is when you are working for a tax-exempt entity, like a church or government agency. Then, certain items you are using on a job are not subject to sales tax.
Also, lawn care services are subject to sales taxes in Pennsylvania, but that's another topic.
The Pennsylvania Department of Revenue has a pretty good website on this topic in a question and answer format. Click here to go to their website.
Questions? PLNA members may call Gregg Robertson at 717.238.2033 and he'll do his best to answer them!