California Sales Tax on Labor Charges
- Jun 20, 2012 | Steven Dunston
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.