PressureWashingBossPro Blog — Billing & Payments

Sales Tax on Pressure Washing Invoices: Setting It Up and Knowing When to Ask an Accountant

Sales tax is the part of billing most pressure washing owners would rather not think about. That is understandable. The rules are different from one place to the next, they change, and getting them wrong is not something you notice until somebody asks. The practical answer is to get good advice once, set it up correctly, and let the software apply it on every invoice.

This Is General Information

Past-Due Pressure Washing Invoices: A Follow-Up Routine That Gets Paid Without Burning Bridges was about collecting what you are owed. This article is about one line on that invoice that you collect for someone else.

Nothing here is tax advice. Whether your pressure washing services are taxable, at what rate, and how you report and remit the tax depends on where you work and how your business is set up. An accountant or tax professional who knows your area is the right person to answer those questions. What this article can do is help you ask the right questions and set things up so their answer shows up correctly on every invoice.

Why the Answer Varies

Pressure washing sits in an awkward spot for sales tax. In some places, cleaning services on real property are taxed. In others they are not. Some places tax commercial cleaning but not residential, or the other way around. Some treat a house wash differently from a fleet wash. Rates can differ between neighboring towns or counties.

Outside the US, the picture is different again. PressureWashingBossPro works in the US, Canada, Australia, New Zealand and the UK, and each has its own approach to taxes on services. If you work in more than one place, or near a border, the answer can change from one job to the next.

Questions to Bring to Your Accountant

A short list makes the conversation efficient:

• Are my residential services taxable where I work? Which ones?
• Are my commercial services taxable? Is a fleet wash treated differently from a storefront?
• What rate applies, and does it depend on the address of the job or the address of my business?
• Are trip fees and minimum charges taxed the same way as the service?
• Do any of my customers, such as an HOA or a nonprofit, need to give me an exemption certificate?
• How often do I need to file and pay, and what records should I keep?

Write down the answers. They become the setup for your invoices.

Setting It Up Once

Invoices in PressureWashingBossPro include sales tax. Once you know how your services are taxed, set it up so the tax is added the same way on every invoice. That is the whole value of doing it in software: the decision is made once, by someone who has the right answer, and then the invoice gets it right every time, whether it was created by the crew tapping Complete at 3pm or a monthly statement going out on the first.

If some of your customers are exempt, note it on the client record with a tag or custom field so the office knows to handle their invoices accordingly and keeps the paperwork on file.

Show Tax Clearly on the Invoice

Sales tax should be its own line on the invoice, after the surfaces and any fees. A customer who sees the line items, a subtotal and then the tax understands the total. A customer who sees one number that is slightly higher than the quote wonders where the difference came from.

Quote with tax in mind, too. If the estimate showed $325 for a house wash and the invoice shows a higher total because of tax, the customer should not be surprised. Either show tax on the estimate or say “plus applicable sales tax” so the invoice matches what they expected. Consistent pricing from estimate to invoice is covered in From Approved Estimate to Paid Invoice: Keeping Pressure Washing Prices Consistent.

Keep Records Tidy

Whatever your filing schedule, you will need to know how much tax you collected. When every invoice is in one system, with tax on its own line, that number is not a weekend of digging through receipts. The billing reports show what was invoiced and paid, which is what your accountant will want to see.

A month-end review is a good time to glance at tax as well as revenue. If something looks off — an invoice with no tax that should have had it, or the other way around — fix it while the job is recent.

Get It Right Once

Sales tax does not have to be a yearly headache. Ask an accountant how your services are taxed, set it up once, show it clearly on every invoice and keep the records in one place. PressureWashingBossPro adds sales tax to invoices and keeps every invoice and payment together for tax time. See the rest of the billing tools on the pressure washing invoicing software page.