I own an electronics store in San Francisco, California. We deliver many of these orders utilizing either our own internal delivery service or a third party such as Fedex or UPS. Do we collect sales tax on delivery and handling charges in all instances?

ANSWER

The BIDaWIZ Team's Answer:

Generally speaking, the seller should collect sales tax on delivery and handling charges when utilizing its own delivery service. However, if the seller is utilizing a common carrier such as U.S. Mail, Fedex or UPS, then the seller does not need to collect sales tax as long as the delivery charge is separately stated on the invoice. If the delivery charges are not stated separately, they are taxable. As far as handling charges, they are generally taxable. This is referenced in California Regulation 1628, Transportation Charges or publication 100, Shipping and Delivery Charges.