This one goes out to the photography businesses here in BC.
With the return of our beloved (insert sarcastic cough) PST (Provincial Sales Tax) here in BC it left me in a bit of a quandary. We are a service business with a tangible product… when do we charge PST?
Being the Google Geek that I am, I started there. I figure if we ever give up photography, I could Google for businesses as a profession! I can find anything and in record time… usually. This one was a tough one. Everything I Googled came up with either people wanting me to pay them to tell me about the rules or the actual PST document from the government which was a little too vague for my specific question. Do I charge PST on my sitting fee when it is collected separately than any sales of goods?
So, when Google left me still confused. Though to me, I figured that no PST on sitting fee and yes on prints but then came the question about video work and weddings and other times that a tangible good and service are packaged together. Do I only charge PST on the actual tangible goods or on everything? And this I did not want to get wrong because if I under charge on PST and at the end of the year figure that out, well, that would stink! So, I asked my accountant (who is fabulous!!!) and she thought the same as me in regards to the sitting fee but suggested to get it in writing from the government to CYA should I get audited and the auditor have a differing opinion.
So I wrote the taxman asking this question:
I have a photography studio and I am seeking clarification on if I am to charge PST on my session fee.
When our clients come in they are charged a sitting fee that is a service only. They get their hair styled, makeup applied and photos taken. At this point they have not purchased any tangible product and this is charged separately without guarantee of any purchase of photos. They then come in at a separate time to purchase photos, though there is the chance that they may not purchase anything. I do charge PST on any photos purchased but I am unclear if I charge for the session.
Because it is considered a service without tangible product, should I charge PST?
I got my response today and, when I was telling Tobin about it, he suggested that I share it with you all since it is excruciatingly detailed, not only for photographers but for videographers as well! I would LOVE to sum it up for you, but on the off chance that I get it a little wrong, I would hate to give you misinformation. So, without further ado, here are all the answers in regards to your photography/videography business and PST in the Province of BC as of September 4, 2013. Oh, yeah and I made it pretty to encourage you to share and pin it 🙂
Clicking this guide will take you to the PDF and all the links will be live, the little hand that shows they are live doesn’t pop up but they are live!