Free guide for contractors
Do contractors charge sales tax in Virginia?
General information, not tax advice. Tax rules change and depend on the details of each job. Confirm how they apply to your business with your accountant or the state's revenue department before relying on them.
VA Virginia
Usually no tax on the invoiceNo, for construction work. Virginia contractors are the consumers of their materials and allow for the tax in their bids, not as a tax line.
Virginia deems a person who contracts to do construction or other real property work, and furnishes the materials, to have bought those materials for use or consumption. The contractor does not pass the tax on to anyone else as a tax; it allows for the tax in its bid.
A contractor that also sells goods to customers is a dealer for those sales and must register. A retailer that sells and installs goods adds tax to the sales price. A separately stated installation charge is not taxed; if it is not separately stated, the total is taxed.
Persons who furnish and install locks and locking devices are retailers, not using or consuming contractors, and so are businesses primarily installing security systems for financial institutions.
It turns on: whether the job is a real property contract or a retail sale with installation; for a retail sale, whether installation is separately stated; whether the work is lock or financial-institution security installation.
Watch out for
- A sale to a contractor is not exempt because the project owner is a government agency (23VAC10-210-410(A), (J)).
“does not pass the sales or use tax on to anyone else as a tax.”23VAC10-210-410(A)