TAX NEWS - January 2010

Florida Sales and Use Tax on Insect or Pest Exterminator Services

Definitions

Residential facilities - Facilities used by persons as living quarters, such as: detached or single-family dwellings, apartments, duplexes, triplexes, quadraplexes, residential condominiums, residential cooperatives, residential time-share units, beach cottages, nursing homes, and mobile home parks; as well as the common areas of those residential facilities. Residential facilities include multi-unit structures where each unit is intended for use as a private temporary or permanent residence, but do not include facilities used for commercial or industrial purposes.

Tangible personal property - Personal property that may be seen, weighed, measured, or touched or is in any manner perceptible to the senses, including electric power or energy.


What is Taxable?

Services

Nonresidential pest control services are subject to state sales tax, plus any applicable discretionary sales surtax. Nonresidential pest control services are services (not involving repair) performed to reduce or eliminate any infestation of nonresidential buildings by vermin, insects, and other pests. You must charge tax on the total sales price or cost price of such services.
Here are examples of services that are subject to sales tax:
- Annual or periodic pest inspections.
- Bird proofing.
- Exterminating services.
- Fumigating services.
- Pest control in structures.
- Termite control.
- Soil treatment for termites or other pests performed before constructing a nonresidential building.
- Charges to a lessor of a nonresidential building for pest control services, even if the tenant or lessee is a tax-exempt entity.


Purchases

Pest control service providers are the ultimate users or consumers of the tangible personal property sold to them and used in connection with their service, such as chemicals, insecticides, equipment, motor vehicles, etc. Therefore, they are required to pay sales tax on such purchases.


Discretionary Sales Surtax

Most counties impose a discretionary sales surtax on sales that are subject to sales tax. The surtax rate is the rate in effect for the county in which you perform the pest control service. More information can be found in the Discretionary Sales Surtax brochure (Form GT-800019) and on the list of surtax counties and rates (Form DR-15DSS). You can find these and other publications on our web site at www.myflorida.com/dor.


What is Exempt?

The following services and sales are not taxable:
- Residential pest control services.
- Spraying of lawns, whether residential or nonresidential.
- Charges for pest control services provided at residential facilities that offer temporary or permanent residences, even though the rental, lease, letting, or licensing of such living accommodations may be subject to tax.
- Pest control services provided by employees to their employers. Rule 12A-1.0161(3), Florida Administrative Code (F.A.C.), has more details. See "Reference Material."
- Pest control services provided to a utility shed located on the same property as a residential building, provided no commercial activity goes on at the utility shed and the services are part of the pest control services to the residential building.
- Pest control services provided to aircraft, boats, motor vehicles, and other vehicles.
- Sales to nonprofit organizations that hold a current valid Florida Consumer's Certificate of Exemption (Form DR-14) and present a signed copy of their certificate to the seller at the time of purchase.


Who Must Register to Collect Tax?

If you sell taxable services, you must register as a dealer to collect and remit sales tax. You can register to collect and/or report tax through our Internet site. The site will guide you through an application interview that will help you determine your tax obligations. If you do not have Internet access, you can complete a paper Application to Collect and/or Report Tax in Florida (Form DR-1).

After we approve your registration application, we will send you a Certificate of Registration (Form DR-11), an Annual Resale Certificate (Form DR-13), and your tax return forms. You will use the Annual Resale Certificate to purchase services tax-exempt that you will resell in your business. You must present a signed copy of your current valid Annual Resale Certificate to the seller when you make these purchases.


When Tax is Due

Returns and payments are due on the 1st and late after the 20th day of the month after each collection period. For example, if a sale takes place any time during the month, tax is not due until the 1st of the next month.

Returns and payments postmarked after the 20th are late. However, if the 20th falls on a Saturday, Sunday, or federal or state holiday, returns and payments will not be late if they are postmarked on the first business day after the 20th.

If you make tax payments using electronic funds transfer (EFT), you must transmit the funds before 5:00 p.m., ET, on the banking business day before the 20th.


Tax Penalty and Interest on tax

If tax returns and tax payments are not postmarked or hand-delivered on or before the due date, you will owe a late penalty of 10 percent of the amount of tax due. You will owe a minimum tax penalty of $50 on late returns, even if no tax is due. Penalty also applies if the return and/or payment is incomplete. A floating rate of interest applies to underpayments and late payments of tax. We update the rate January 1 and July 1 of each year by using the formula established in section 213.235, Florida Statutes. Current and prior period interest rates are posted on our Internet site.


Reference Material

Tax Laws – Florida Tax online Tax Law Library contains statutes, rules, legislative changes, opinions, court cases, and publications. Search the law library for Rule 12A-1.009, F.A.C., Receipts from Services Rendered by Insect or Pest Exterminators and Rule 12A-1.0161, F.A.C., Sales and Use Tax on Services; Sale for Resale.

Brochures – Download these brochures from Florida Tax web site "Forms and Publications" page:
- Discretionary Sales Surtax
- Cleaning Services
- Commercial Real Property Rentals


For Information and Forms

Information and forms are available on Florida Tax website:
www.myflorida.com/dor

To speak with a Department of Revenue representative, call Florida Taxpayer Services, Monday through Friday, 8 a.m. to 7 p.m., ET, at 800-352-3671.

Persons with hearing or speech impairments may call our TDD at 800-367-8331 or 850-922-1115.

For a written reply to tax questions, write:

Taxpayer Services
Florida Department of Revenue
5050 W Tennessee St Bldg L
Tallahassee FL 32399-0112


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