Do any of you pay taxes in the county/state where you have colo equipment? We don't pay use tax on equip in our CA datacenter here in UT, so UT felt the need to contact Ca and let them know...nice.

Taxes are always paid in the state where your business is registered, not in the place where you rent, buy or do whatever you need to do. Taxes are on profit as well, not on equipment...

Another thing is that when you purchase a service there are taxes for the seller and he shows the charges separately to you(i.e. 50$ +2$ taxes=52$). But in fact you are just buying a service for the total (52), not paying taxes. It's your vendor that pays the taxes and justifies the price increase that way.

I hope this helps

AQ

I dont have to, but its probably because the host I run isnt all that big yet. In time I might have to. Hope this answers your question.

Do any of you pay taxes in the county/state where you have colo equipment? We don't pay use tax on equip in our CA datacenter here in UT, so UT felt the need to contact Ca and let them know...nice.

Honestly I don't find agoraquimica's comments to make much sense.

The answer is yes. We do pay taxes on services rendered to us such as colocation. Thankfully in Canada, you can incorporate in another province, and claim the taxes in that province. (you pay the taxes, but you later receive them back as a refund from the government - that's how it works here in Canada for GST/HST registered company. Last time I checked, companies must charge tax if revenues are > 30k/year, but can also join volontarily)


I believe taxes are different in each country and each province/state. You should check with an accountant to see if there is anything you can do to benefit your company.

Taxes are always paid in the state where your business is registered, not in the place where you rent, buy or do whatever you need to do. Taxes are on profit as well, not on equipment...

Another thing is that when you purchase a service there are taxes for the seller and he shows the charges separately to you(i.e. 50$ +2$ taxes=52$). But in fact you are just buying a service for the total (52), not paying taxes. It's your vendor that pays the taxes and justifies the price increase that way.

I hope this helps

AQ

*bzzzz!* wrong.

If you dont know what you're talking about, you probably shouldn't post on a subject.

Taxes vary from location to location, eg. in Ontario, Canada, if you Colocate gear, its considered a physical business presence (and thus you pay GST/PST as applicable for services).

There are various types of tax, I'm talking about use tax - which is location dependent. If you don't use the equipment in your state or county (depending on the assesor) you don't have to pay taxes on them there..in fact, it's not legal for a state to assess you use tax on things located elsewhere (but are still corporate assets).

There are various types of tax, I'm talking about use tax - which is location dependent. If you don't use the equipment in your state or county (depending on the assesor) you don't have to pay taxes on them there..in fact, it's not legal for a state to assess you use tax on things located elsewhere (but are still corporate assets).

Well, for example, in Canada (I'm surprised a lot of Canucks joined into this thread :)), we don't charge tax to out-of-country residents. Ie. Only Canadians pay GST/PST.

To touch base on what Zenutech said, in Canada, a business must start collecting GST when they know that their sales are going to reach $30k in a given tax year. Voluntarily collecting GST allows the ability to claim back the GST on any business purchase. Not sure what province Zenutech is in, but we are incorporated/operate in BC and we are able to claim back the GST on our purchases. We didn't need to incorporate in a difference province for that.

PST is a bit different in the sense that if you sell a taxable product/service, regardless of revenue, you must collect/remit PST. If you make 1 sale of $10.00 that is suppose to have PST on it, you must collect the PST and mail it to the government.

Anyways, I'm not an accountant or a tax lawyer, so my information is not guaranteed. However, I have been around the block a couple times regarding this stuff so feel I do have a general grasp here :)

Well, for example, in Canada (I'm surprised a lot of Canucks joined into this thread :)), we don't charge tax to out-of-country residents. Ie. Only Canadians pay GST/PST.

You dont collect GST on colocation customers who are out of country? (you do sell Colo in BC right?). Whats your accountant say about that (we didn't charge either for about 3 years, then got scolded as a result).

Well, for example, in Canada (I'm surprised a lot of Canucks joined into this thread :)), we don't charge tax to out-of-country residents. Ie. Only Canadians pay GST/PST.

To touch base on what Zenutech said, in Canada, a business must start collecting GST when they know that their sales are going to reach $30k in a given tax year. Voluntarily collecting GST allows the ability to claim back the GST on any business purchase. Not sure what province Zenutech is in, but we are incorporated/operate in BC and we are able to claim back the GST on our purchases. We didn't need to incorporate in a difference province for that.

PST is a bit different in the sense that if you sell a taxable product/service, regardless of revenue, you must collect/remit PST. If you make 1 sale of $10.00 that is suppose to have PST on it, you must collect the PST and mail it to the government.

Anyways, I'm not an accountant or a tax lawyer, so my information is not guaranteed. However, I have been around the block a couple times regarding this stuff so feel I do have a general grasp here :)


Ah, I just realized that what I said may not have been clear.
The reason I said what I said is because we are physically located in New Brunswick, but our servers are in Montreal, Quebec.
We are registered as a business in New Brunswick, but also incorporating in Quebec would allow us the ability to claim provincial sales tax paid on our server co-location.
Anyways, I'm not sure if this can be done in USA, but in Canada many companies do it (companies that do business in multiple provinces incorporate in multiple provinces)

You dont collect GST on colocation customers who are out of country? (you do sell Colo in BC right?). Whats your accountant say about that (we didn't charge either for about 3 years, then got scolded as a result).

Nope, and haven't heard otherwise. I have a meeting with the accountant this week regarding personal taxes anyways, so perhaps a simple inquiry would be in order ;)

Nope, and haven't heard otherwise. I have a meeting with the accountant this week regarding personal taxes anyways, so perhaps a simple inquiry would be in order ;)

Last year we got "audited" by the gov. They said that you can send a professional letter to revenue canada concerning your business. They will look at the list of services you offer, and will tell you exactly how much tax you should charge for each element, as well as depending on where the customer resides. (they send you a certified letter back)

I was told that if in several years the government comes back saying you owe X amount because you didn't charge enough taxes (or any), then you have the letter that saves the day.

Maybe something to look into Vanhost :)

Myles - I still plan on asking our accoutant this week regarding the GST requirements. However, during some searches today I have found the following article:

http://www.cra-arc.gc.ca/tax/business/topics/gst/corporation/taxable/importsexports/exportedservices-e.html

I am still digging, as there seems to be multiple levels of the "tree" here.

*bzzzz!* wrong.

If you dont know what you're talking about, you probably shouldn't post on a subject.
bzzz! Wrong again!

Taxes are different from state to state/province to province therefore there is no real answer to this questions other then to contact your state/province tax office for more information.

I think I was unclear in my orig post, Ca being California, not Canada

luckily I dropped by to defend my posts :-)

Maybe I did not explain myself very well before, but allow me to try again

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Do any of you pay taxes in the county/state where you have colo equipment? We don't pay use tax on equip in our CA datacenter here in UT, so UT felt the need to contact Ca and let them know...nice.

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He does not have to pay any taxes in CA (California) even if he buys colo there. Taxes for his company should be paid only in UT, since his company is registered there.

I hope this time I've expressed myself better than with the 1rst post. I believe not everybody got it right. And finally, yes, I know what I'm talking about ;)

cheers,

AQ

In the EU you'll have to pay VAT. In the UK the VAT rate is 17.5%, not sure if this is the same throughout the European Union.