Is Labor Subject to Sales Tax in Florida? 2024

Individuals living in Florida expect sales taxes on most goods, but they are often surprised when labor or services are taxed. Floridians often wonder, “Is labor subject to sales tax in Florida?” While most services are not taxable in the state, certain forms of labor are indeed taxable.

Business owners and consumers alike must be aware of these requirements so they are charging and being charged a fair amount. Consumers should know whether they should or should not be charged a service tax. Businesses, especially must be sure they are in compliance with tax law. That way, they do not find themselves with a substantial tax debt and the potential for other penalties. Consulting with an IRS tactics lawyer in Jacksonville can help address these concerns effectively.

Only certain types of labor are taxable, and even those occur under unique circumstances. Ensuring compliance can be complex. Support from a tax legal professional can make things much easier for business owners as they navigate state, federal, and local tax compliance.

What Services in Florida Are Taxable?

Most labor or services are not subject to a sales tax. However, the state does tax specific services, including:

Commercial and Industrial Cleaning Services

Nonresidential cleaning services typically have a services sales tax. These include services such as:

• Maid
• Non-repair maintenance
• Housekeeping
• Cleaning
• Custodial operations
• Sanitation
• Janitorial services

It largely refers to interior services, with the exception of exterior window cleaning. The tax applies to cleaning buildings such as:

• Office buildings
• Warehouses
• Restaurants
• Factories
• Other nonresidential buildings

Homes and residential locations are not subject to this tax on cleaning services.

Labor on Real Property or Repairs to Tangible Personal Property

Whether property improvements or repairs are subject to taxation depends on the type of contract and the nature of the repairs. Most transactions involving real property are nontaxable unless it is handled under a specific type of contract. Repair labor to real property is taxable. Repairs to tangible personal property are typically taxable when both parts and labor are involved.

Communication Services

Taxable communication services are taxed on the state and local level. These include:

• Video
• Telecommunications
• Direct-to-home satellite
• Private line
• Voice-over internet protocol
• Video streaming
• Mobile communications
• Telegram
• Fax machines
• Other communication services

The transmission of signals or information through audio, video, data, or other form is included. Companies that sell these services must register the addresses where the communication services are being used and make sure they are taxed to the correct jurisdiction.

Commercial Pest Control Services

Nonresidential pest control services have a service sales tax, but residential pest control is not taxed. This includes the elimination of any insects, vermin, or other pests in a business or other nonresidential building. It covers services like inspections, prevention, fumigation, control, treatment, and other services.

Detective, Burglary Protection, Security, and Other Protection Services

Both residential and commercial detective or security services are taxable. These include:

• Detective agencies
• Investigative, bodyguard, burglar, or fire alarm maintenance and monitoring
• Guard and patrol activities
• Protective or investigative dog
• Fingerprinting
• Armored car
• Missing person tracing services

It can be hard to determine what is counted as a security service, so it is important to talk with a knowledgeable professional if you are a business owner.

Commercial Amusements

There is a service sales tax on admission fees for entertainment. This includes trade shows, consumer exhibitions, and conventions.

The Complexity of These Guidelines

These laws are changeable, and they may have unique exceptions depending on the specific services, products, or customers. It is important to review the laws that apply to your specific county as well. A skilled tax attorney can review your business’s circumstances and determine what sales taxes apply to your products and services.

FAQs About Labor Subject to Sales Tax in Florida

Who Is Not Subject to Sales Tax in Florida?

Some customers are not subject to sale tax in Florida, including:

• State, county, municipality, and political subdivision governmental agencies
• Governmental entities, including public school districts and municipal libraries
• Certain nonprofit organizations
• Businesses purchasing or renting goods or services for the purpose of resale

Nonprofits and political subdivisions are required to secure a sales tax Consumer’s Certificate of Exemption. Federal agencies are not required to have this certificate, but having one makes the process easier for retailers. Merchants reselling goods and services are required to have a Florida Annual Resale Certificate.

Which of the Following Is Exempt From Sales Taxes in Florida?

Several consumer goods are exempt from sales tax in Florida. These include, but aren’t limited to:

• Prescription items, such as medication, medical supplies, eyeglasses, lenses, contact lenses, chemical compounds, and test kits for diagnosing and treating disease, cosmetics, toiletries, prosthetics, and orthopedic appliances
• Certain common household remedies, such as antacids, first aid kits, bandages, and lip balms
• Certain infant supplies
• Oral hygiene products, such as toothbrushes, toothpaste, and dental floss
• Products for absorbing menstrual flow
• Bakery products in establishments without eating facilities
• Groceries that are not for immediate consumption

Do Contractors Pay Sales Tax in Florida?

Yes, contractors generally pay sales tax and surtax in Florida when purchasing materials or supplies for construction. This is the case, even when the purchase is for a governmental entity that is tax-exempt. Property contractors determine how materials and supplies are taxed through pricing arrangements in the contract.

When contractors perform lump-sum, fixed-fee, or similar types of work, the contractor is considered the final consumer in the use of the materials and supplies, so sales tax is not applied to the property owner.

Is a Service Charge Taxable in Florida?

Services are typically not taxable in Florida, with some exceptions. These include:

• Cleaning services for the interior of nonresidential spaces
• Pest control services in nonresidential spaces
• Crime and investigative protection services
• Repairs and alterations to tangible personal property
• Communications services
• Protection services
• Operations of vending or amusement machines

There may be other exceptions, and it is important to discuss your business and service with a tax attorney to be sure you are complying with the law. These professionals know the changes to and intricacies of tax codes.

Tax Smith Tax Attorneys: Helping Business Owner Taxpayers Remain Compliant in Florida

At Tax Smith Tax Attorneys, we have decades of tax law experience, helping individual and business owner taxpayers navigate federal, state, and local tax codes. Remaining compliant with these tax codes is crucial for avoiding potential fines or more serious penalties. Contact Tax Smith Tax Attorneys to see how we can assist you today.