A question for you Texas business owners. I'm in the process of starting my own firm and I'm a little fuzzy on some sales tax issues. My basic understanding is that boundary surveys are taxable and topo surveys are not. If i perform a boundary survey for $2,000, then that full amount would be taxed. If I prepare a subdivision plat for a client, I'm assuming that would be taxable as well. What about "consulting" or "management" services? Can i charge a line item fee to prepare a subdivision plat, say $3,000 (taxable) and then charge a "management" or "consulting" fee to attend meetings at the city and expedite plat approval for say $5,000 (non-taxable)? Thoughts? also any general info you may be able to direct me to on surveying and sales tax in Texas would be much appreciated. Thanks
edit: what got me thinking about this in the first place is a copy of a competitors proposal that was emailed to me from a potential client. The proposal is from a "management company" that offers platting services but they dont have a Surveyor on staff. They require the client to provide a "GPS Boundary Survey" of the tract, and then they take the data and provide "platting services" and they dont charge sales tax for that service. If im required to charge sales tax on my entire invoice it puts me at a disadvantage price wise compared to this non-licensed competitor.
Simplified version: if it is for a conveyance (fee or esmt/otherwise): tax.
No conveyance (including plat), no tax.
(This is how I was told to write proposals 15 years ago and did for a decade at a former employer. When I started a company I ran it by my accountant and he said groovy. The IRS and the comptroller have left me alone to this point.)
I know TSPS is trying to get new new Bills passed to make Surveying Tax exempt.
Scott Ellis, post: 414642, member: 7154 wrote: I know TSPS is trying to get new new Bills passed to make Surveying Tax exempt.
do you currently charge sales tax for platting?
RPLS#, post: 414644, member: 12280 wrote: do you currently charge sales tax for platting?
We do, does the company you work for now charge sales tax for platting?
Boundary is taxable, and a Topo is not taxable, however if you do a Boundary and topo at the same time, which is usually the case then you tax both.
If the Elevation Certificate is going to be used for insurance then it is taxable, so pre is tax exempt, under and final are taxable.
When in doubt charge the Tax, because Uncle Sam wants his money and he does not care if you have to reach into your pockets to pay the tax Bill.
You really need to hire an Accounting and go over what is and what is not taxable with them.
The amount of time you spend finding, setting and/or referencing to the boundary is taxable.
The amount of time you spend shooting topo is non taxable.
It can be argued that your tax rate is the location of the job or the location of your office.
The debate would be about what you are doing at the site and/or at the office.
I have always taxed at the rate for the location of my office.
Tax is always calculated on the amount of my fee.
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We do exactly what Mr. Harris does, which is the same as my last employer. We are in a small town and we shopped CPA's when we started (for knowledge not price). None that we talked to had ever had Survey company as a client. We did our Research at the comproller and honestly we mixed the requirements on the comptrollers website, with common sense and what we knew other surveyors did and decided that was the best option that we could stand behind and manage
This discussion reminds me that I really hope CA doesn't do the tax-on-services thing.