Sales Tax Basics for Interior Designers and How To Get Set Up to Sell Trade
Now, this may be old hat for many of you, but if you have a newly established business or have been hesitant to sell trade because of the fear of sales tax, this post is for you!
If part of your revenue comes from the re-sale of goods (whether it be furniture, fabric, accessories, or cabinets and countertops), and you purchase those items from a to-the-trade vendor at net pricing, then everything in this post is critically important to you.
Sales tax (that we all pay every time we go shopping) is paid by the end-user of goods or merchandise. When you—as a designer—purchase goods and sell them to your clients, those clients are the end-user (not you) and therefore must pay sales tax to the state and sometimes also to a local jurisdiction (county or city) tax collecting agency. You collect the sales tax from the client and remit it to the state.
Let’s talk about three parts of this process:
Purchasing from a to-the-trade vendor.
Selling goods to the client (the end-user) and collecting sales tax.
Paying that sales tax to the state and local tax collecting agencies.
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