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California Sales Tax on Labor Charges


The California Board of Equalization revised a publication explaining sales tax on labor.

Although many believe labor charges are exempt from sales tax, California sales tax applies to many types of labor, including ". . . producing, fabricating, or processing tangible personal property . . . ."

A taxpayer who performs taxable labor in California must " . . . obtain a seller's permit and report and pay tax on [their] taxable services." One can apply for a seller's permit online using eRegistration, or eReg.

For special tax rules that apply to labor on buildings and real property see publication 9, Tax Tips for Construction and Building Contractors.

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Steven Dunston
Avalara Author
Steven Dunston
Steven Dunston
Avalara Author Steven Dunston
Steven Dunston is a marketing technologist with experience as a web developer, SEO specialist and creative director. Steven is manager of the Marketing Technology Group at Avalara.