Important Notice: Our web hosting provider recently started charging us for additional visits, which was unexpected. In response, we're seeking donations. Depending on the situation, we may explore different monetization options for our Community and Expert Contributors. It's crucial to provide more returns for their expertise and offer more Expert Validated Answers or AI Validated Answers. Learn more about our hosting issue here.

What are my responsibilities regarding the sales tax when a gift certificate is purchased for cosmetic therapy services?

April 26, 2017Certificate cosmetic gift responsibilities Services therapy

0

Posted

What are my responsibilities regarding the sales tax when a gift certificate is purchased for cosmetic therapy services?

1 Answer

0

Posted

If the certificate is for the performance of a specified service (i.e. a certificate for one or more treatments) you need not collect tax from the recipient when that service is performed. Such certificates sold on and after August 1, 2003 are subject to sales tax when the certificate is sold. Any additional amount you charge the recipient for additional services would be taxable. If the certificate is for a specified dollar value (i. e. fifty dollars toward any product or service at a salon), the certificate is treated the same as cash. When such a certificate is used to purchase taxable property or services, tax should be charged on the full price of the property or service.