Taxation and Digital Delivery11807
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botticelli private msg quote post Address this user | |
| In NY we don't have to charge sales tax on digital goods/services. Are there any states/countries which charge tax on digital photography, video, floor plans, etc? I'm asking because I noticed on my Matterport billing that they charge tax on everything from subscription to floor plans. | ||
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Houston |
briangreul private msg quote post Address this user | |
| Texas charges tax on all Photographic services. It's pretty air-tight. The copyright itself is not taxable, but I'd just assume collect it and move on with life. https://comptroller.texas.gov/taxes/publications/94-176.pdf is the publication. Now, most of our work is for resale, so a client could in theory provide an exemption certificate. I think most Photographers in Texas simply ignore this and haven't gotten burned by the Comptroller's audit team yet. It's also worth understanding "The throwback rule" for sales tax. Basically, if something isn't taxed where it's going then the origin state can "throw back" the transaction and tax it. I know NY, CA, and FL are particularly nasty about sales tax... but Texas has that saying, "Don't Mess with Texas" I could claim exemption on my equipment purchases, but I've decided to just do my part and pay the little bit of sales tax (less than $1k/yr) to support our State functions like education, etc. Our lawmakers are only in session for 90 days every other year... and they don't get paid squat. Unlike the clowns of DC. |
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CTownMedia private msg quote post Address this user | |
| In Ohio, we don't have any sales tax on digital goods and services, so I haven't charged. I believe in some states though, if you provide the storage/hosting/servers for which the digital good is delivered and housed, it would be considered physical and would be taxable, which I think is why we are charged sales tax on our processing and hosting because MP has their own servers/data storage. Could be wrong on that though and would love to hear others thoughts or knowledge on this too. | ||
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3SixtyNow private msg quote post Address this user | |
| They charged me tax last month as well. I had to tell them that NC doesn't charge sales tax on non-tangible goods. I was told they were looking into it on April 4th. I haven't heard from them since and they did it again this month. I haven't been charged sales tax in 3yrs. | ||
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Houston |
briangreul private msg quote post Address this user | |
| I missed part of the OP's question. Matterport is delivering an online service or SAAS (Software As A Service)... . that's taxable in most places. Big $$$ involved and states are hungry for $$$. Especially NY, FL, CA....... lol. |
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3SixtyNow private msg quote post Address this user | |
| I guess I should have sent them this Private Letter Ruling from 2018. clickable text |
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jacobpmac private msg quote post Address this user | |
| @botticelli @briangreul I live in CA. I was under the impression that there is NO sales tax when you deliver photography (including virtual tours) electronically. Can someone confirm if this is accurate information? This was taken from the California Department of Tax and Fee Administration: Sales that are Generally Nontaxable This section includes information on sales that are generally not taxable, such as electronic transfers of photographs, repair labor, sales for resale, sales in interstate and foreign commerce, sales to the U.S. government, and certain other transactions. Electronic transfer of photographs Tax applies to your sale of tangible, physical products, including photographs. However, if you transfer a photograph electronically and do not include any physical product in your sale, tax does not apply. This is true whether you transfer a photograph by the “load and leave” method described below or remotely (for example, by email or file transfer protocol [FTP]). Please note that sales tax will apply if you provide your client with a copy of the electronically transferred photograph in any sort of tangible form such as a copy of the photograph on a CD or other storage medium or a physical print, copy, or negative of the photograph. You should document any electronic transfer of a photograph so that you can show why tax does not apply to that transaction. For instance, if you electronically transmit a photograph to a customer by email, you should print out a copy of the transmittal email and retain that copy in your records. If you transfer a photograph by FTP or download it to your customer’s computer directly from your computer, a CD, or another storage medium that you keep (the “load and leave” method), you should document the transfer in your records. One way to do that is to place a document in your project file listing the customer’s name and the date, place, and method of the transfer and noting that you did not provide the customer with any physical products in addition to the electronically transferred photograph. You should have your customer sign and date the document at the time of the transfer. We suggest you use the following language for your documentation: “This electronic photographic image was loaded into the computer of [client’s name] by [photographer’s name], and [photographer’s name] did not transfer any tangible personal property containing the image, such as electronic media or prints, to [client’s name].” Note: As you read the rest of this publication, please remember this exclusion for electronic transfers of photographs. |
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Houston |
briangreul private msg quote post Address this user | |
| @jacobpmac It varies by jurisdiction. In Texas I'm subject to Sales Tax. Rather than waste energy arguing about it I just collect it or an exemption form and move on. The tax on the hosting plans isn't significant enough for me to waste any time on. |
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