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In an independent contractor in Hawaii. There is a 4% excise…

In an independent contractor...

In an independent contractor in Hawaii. There is a 4% excise tax for independent contractors. I'm a tennis pro working for a resort. The resort pays me 70% of my lesson. For instance, a lesson is $100 . The resort charges the client the $100 plus 4.17 sales tax, $104.17. When I get 70% it's $70, I don t get a percentage of the sales tax. My question. Since the tax is paid to the hotel do I have to pay the excise tax in addition?

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Answered in 12 minutes by:
12/13/2017
Lev
Lev, Tax Advisor
Category: Tax
Satisfied Customers: 33,126
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The General Excise Tax (GET) is imposed on gross income by businesses, meaning that part of every single business transaction goes to the state.

Correspondingly - YOUR gross income as an independent contractor or self-employed individual - is subject to the excise tax.

You are allowed to pass the tax on to your customers, but if you do so the tax will be calculated on the total amount you collect, including the extra for the tax.

That is between you and your customer how your services are paid.

In this situation - your customer is the resort.

You may for instance negotiate that the resort will pay you $73 instead of $70 in your example.

But in this case - you will pay GET on THAT amount.

Whatever the resort charging their customers - is not relevant to your tax liability.

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