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

April 26, 2017Certificate gift massage responsibilities Services therapy

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

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If the certificate is for the performance of a specified service (i.e. a certificate for a manicure or a one-hour massage) 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.