Kicked in the n@ts by the state

[ffaelan]

So does anyone know a good sanding supplies vendor? My Klingspor rep has informed me that they will be charging us sales tax on all products regardless of what type of resale license we have because they were audited by the state. So I'm supposed to pay the stated once and then have my customers pay them again just so Klingspor can play it safe. So needless to say we're looking for another vendor.

[thewoodcrafter]

I pay sales tax on all my purchases, especially consumables. It eliminates my sales tax liability later. Why don't you?

[harryball]

I depends on the state. My understanding of Georgia is that I can deduct sales tax paid for supplies from sales tax collected from customers of course provided those materials went into the products provided. However, paying your sales tax on your supplies does not mean you do not have to collect sales tax from your customers. Any product sold that is not a passthrough, i.e. you have added value, is subject to sales tax.

It is best you contact your own state sales tax department and gain your own understanding before making any assumptions.

/RB

[harryball]

PS... as the economy continues to falter and govenment budgets wane... expect A LOT more of this type of thing. Keep your books in order because big brother is watching your wallet.

/RB

[cutitout]

The Time and Money given to comply to Big Bro. Is getting overwhelming and under represented

Food for thought -- I travel out of state or to the next town -- I pay taxes there (sales, prepared meals, hotels...) but I don't get to vote for there rep.,town council... the ones setting the taxes I Paid.

This great nation was started over 3% tax on tea, wish we could go back to that.

[rcnewcomb]

In my state I have to pay a sales/use tax on consumables but not on material that goes to the customer if I charge sales tax on that. So I pay taxes on router bits and sandpaper, but not on the wood.

Talk to your accountant for details in your state.

[thewoodcrafter]

I know in California someone HAS to pay the tax on all the material going into the job.
Either the contractor or the consumer.
If the job is a bid price with installation (and installation is more than 10% of the total) the contractor pays sales tax on his costs. The contractor is considered the consumer.
If it is retail material or a quoted job where the install is less than 10% of the total the consumer pays the sales tax.
I have found the easiest way to handle sales tax is pay it on everything you buy and don't retail out anything. Then technically you don't need a sellers permit in this state and you don't have to file sales tax reports.

[cutitout]

Randall -- throw in a used bit and sandpaper with the customers order.

Look at all the work/time being nonproductive to comply to the tax man.. so he can "help" the nonproductive.

Roger like that plan less work on your side. just pass it on to the customer in the markup.

[knight_toolworks]

I have been real happy with A&H abrasives. most of what I use is custom and they get it out that day if I order it in the morning. prices are good and you can get about anything. I always call 1-800 831 6066