Georgia sales tax audit interior design company
How are you being audited for sales tax when you offer a service? A great one at that! When you are approached by the GDOR for your books and records, you need to know what they are looking for and why they think you might owe sales tax. Again, you as the vendor did not receive anything that you needed to pay sales tax on, however, you might have been obligated to collect sales tax.
How does this all work? If you are selling furniture and/or similar tangible items such as decorations as a part of your package as an interior designer, then you will have a sales tax burden.
This works in one of two ways in most cases:
- You purchased furniture from a vendor and then resold it to your end client. You can either purchase the furniture with a sales tax certificate and collect the sales tax from your client, OR
- You can pay the sales tax at the the point of sale directly to the vendor, and then sell the furniture to your client.
The GDOR looks at the gross receipt of your transaction. If the end product looks like you sold a combined service of furniture, tangible goods, and the service of design consulting, your entire receipt can be subject to sales tax.
Having dealt with a few of these types of audits in this particular industry, it is almost necessary for an interior designer to sell furniture and other tangible items with their services. It’s profitable and it’s also necessary to complete their job. Call our office if your company is undergoing a sales tax audit.
Georgia sales tax audit interior design company
