Taxing on services and Lease agreements

so the good part is i have three completed jobs with from my clients. The bad news is how to i tax for services? It would seem like it would be two parts.

1. the service of taking the photos and

2. sale of the actual files

any help of sorting this out would be helpful.

 

secondly

 

how should i create some kind of lease agreement so the clients have limited rights to the photos. i.e. can't let a 3rd party use images. Any thoughts on either one of these questions would be helpful thank you

Tax regulations and one's Taxation responsibilities vary from location to location and sometimes vary by TYPE of business structure. There's not much point in me giving you an overview of my Tax responsibilities for my Proprietary Limited Company in Sydney if you are a Sole Trader working in London.

> Where are you located?

> What type of business do you have?

 

*

 

The 'lease agreement' that you mention is commonly known in most parts of the worls as a "Contract for Usage Rights of Images" (or similar wording). In simple and broad terms it will mainly address:

> the Entity(ies) who may use the image(s) (i.e. if you do not want any 3rd party usage, then you stipulate the one party who can use the image(s)

> the type of usage (e.g. display banner / print run / website etc)

> the amount of usage (i.e. volume; e.g. 'one print run of no more than 100,000 brochures and a second print run of no more than 50,000)

> the duration / expiration (i.e. if and when the usage rights will terminate; e.g. 'enduring usage rights', 'usage rights will terminate three years from the date of this contract')

 

I am neither a lawyer not tax consultant.

 

WW

Take a look at www.thelawtog.com which is an excellent resource for information on photography contract law.

owen search for photography tax rules in your jurisdiction. If you are in the United States this will be a state level rule. Also ask a tax accountant if you know one. Here in Pennsylvania, photography is taxable. If the photography services are sold to a business, they may not be taxable.

 

Regarding usage, there is lots of good information on line. Google is your friend.

More specifically in NJ/PA especially being close to the border, and close to Philadelphia, it matters not even where you do the shoot, but where you ship the final deliverable end-product. And, there can be specific additional taxes for certain cities (such as Philadelphia, which has them). Because photography is such a frequent subject of questions regarding taxes, some states (like NJ) have an entire document and/or web site devoted to information on it. Search on your favorite search engine for "[Your Location] photography do I charge sales tax" and you'll likely find an appropriate document.

Tax regulations and one's Taxation responsibilities vary from location to location and sometimes vary by TYPE of business structure. There's not much point in me giving you an overview of my Tax responsibilities for my Proprietary Limited Company in Sydney if you are a Sole Trader working in London.

> Where are you located?

> What type of business do you have?

 

*

 

The 'lease agreement' that you mention is commonly known in most parts of the worls as a "Contract for Usage Rights of Images" (or similar wording). In simple and broad terms it will mainly address:

> the Entity(ies) who may use the image(s) (i.e. if you do not want any 3rd party usage, then you stipulate the one party who can use the image(s)

> the type of usage (e.g. display banner / print run / website etc)

> the amount of usage (i.e. volume; e.g. 'one print run of no more than 100,000 brochures and a second print run of no more than 50,000)

> the duration / expiration (i.e. if and when the usage rights will terminate; e.g. 'enduring usage rights', 'usage rights will terminate three years from the date of this contract')

 

I am neither a lawyer not tax consultant.

 

WW

thanks for your response

i live in baltimore and i'm shooting architectural

photography.

If i am delivering the images via dropbox or the like, are you still required to charge the tax on your invoice?

Delivery method doesn't matter. The tax is on the value delivered. What did you find when googling your local jurisdiction's tax rules?

Your state will have its own rules. Delivery method might matter, it might not. This is not a question you should be asking here, but rather to the Maryland State Sales Tax office.

 

There is also a previous thread on this topic here.

 

www.photo.net/discuss/threads/charing-sales-tax-in-d-c-maryland-and-virginia.229467/

 

A basic internet search came up with:

 

taxes.marylandtaxes.com/Resource_Library/Tax_Law_and_Regulations/State_Regulations/COMAR/Title_03_-_Subtitle_06.shtml

 

www.dsd.state.md.us/comar/comarhtml/03/03.06.01.16.htm

 

www.taxrates.com/blog/2014/08/15/click-washington-photographers-need-know-sales-tax/

 

www.taxrates.com/blog/2012/03/13/maryland-digital-goods-internet-sales-tax-and-services/

 

taxes.marylandtaxes.com/Business_Taxes/Business_Tax_Types/Sales_and_Use_Tax/Sales_Records/exempt_materials_used_in_production_activities.shtml

Delivery method doesn't matter. The tax is on the value delivered. What did you find when googling your local jurisdiction's tax rules?

not and much success finding tax rules in Maryland. just spoke with an accountant and she has to get back to me with the info

so just to update from accountant....

 

Maryland

Statutes and Regulations - Current

Statutes

TAX - GENERAL

TITLE 11. SALES AND USE TAX

SUBTITLE 1. DEFINITIONS; GENERAL PROVISIONS

(m) “Taxable service” means:

(1) fabrication, printing, or production of tangible personal property by special order;

 

As long as digital (no photos, DVD, thumb drives, it is not subject to sales tax.

 

And there is no tax on the actual service of taking the photos.

taxes.marylandtaxes.com/Resource_Library/Tax_Law_and_Regulations/State_Regulations/COMAR/Title_03_-_Subtitle_06.shtml

 

www.dsd.state.md.us/comar/comarhtml/03/03.06.01.16.htm

 

Better to err on the side of caution. Don't ask an accountant. Ask the state.

You will find on the web sites of the revenue departments of the states where you work or make e-tail deliveries a contact address, either email or postal.

 

Send them detailled questions.

 

Be sure to enquire about exemptions for some small businesses. In my jurisdiction, for example, as a semi-retired, I am not required to charge, collect or remit sales tax if my total annual sales do not exceed $30,000. If I use that option, however, I must pay sales tax on all supplies used to do what I do (I do not have a tax number that I can give tona vendor to avoid paying sales tax.)