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CGCPA
CGCPA, CPA
Category: Tax
Satisfied Customers: 3738
Experience:  over 40 years experience in tax matters
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Hi Is a "Paper Pusher" or individual who refers a general

Resolved Question:

Hi Is a "Paper Pusher" or individual who refers a general contractor to do work in a home subject to collect Pa Sales Tax if the contractor is paid by the "paper pusher?" For instance I (the paper pusher or consultant) refer a handy man to do work in a house for a homeowner in which such house is going to be on the market to be sold. I get a quote for that work from the handy man for such work to be performed in the residence. I add on a commission for my referral and charge the homeowner for the total. I pay the contractor for his services against the his initial quote. I do not perform any work except to connect the two parties and make sure the work is done. Am I required to collect any taxes from the homeowner? This is work done in the State of Pa. Thank you so much Fred
Submitted: 2 years ago.
Category: Tax
Expert:  CGCPA replied 2 years ago.

Welcome to Just Answer. I am here to help you resolve your tax and finance concerns. Please feel free to ask anytime you need extra help.

 

Since you are collecting from the customer you are, in actuality, the primary contractor and the person you select to do the work is your subcontractor. You are the party responsible to collect the sales tax, file the returns and remit the tax to PA.

Customer: replied 2 years ago.
I am not aware of any taxes which I am subject to collect for from the homeowner
Expert:  CGCPA replied 2 years ago.

Sales tax is imposed on all repairs other than those performed for tax exempt entities. Thus, you are the responsible party for those taxes. If you go to the following link you will see the guide for construction contractors. You are in that group.

 

http://www.portal.state.pa.us/portal/server.pt/community/sales,_use___hotel_occupancy_tax/14487/taxability_lists/580900

 

At the following link in section 10 you will find the applicable rules for construction contracts. Your agreement with the homeowner is a construction contract.

 

http://www.revenue.state.pa.us/portal/server.pt/community/sales%2C_use___hotel_occupancy_tax/14487

 

 

CGCPA, CPA
Category: Tax
Satisfied Customers: 3738
Experience: over 40 years experience in tax matters
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