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Ruling 90-5


This Ruling has been obsoleted by AN 94(4)

Performance of taxable services by a subcontractor for a general contractor does not require the collection of the sales tax until the ultimate consumer is charged for such services. The general contractor must issue a resale certificate to the subcontractor in lieu of paying the sales tax at that time and the general contractor must separately state the charge by the subcontractor and the appropriate amount of sales tax therefor on the invoice to the ultimate consumer.

In the event that the ultimate consumer is located outside the state of Connecticut, and the benefit of such services are to be reaped outside of this state, the charge for such services are not subject to the sales tax.

The application of these general principles to the facts presented in your ruling request results in the following ruling:

  • Where Connecticut retailers of services, i.e. A Company and B Company, provide taxable services on a subcontract basis to a Connecticut general contractor, i.e. X, X may issue a resale certificate for such services. Where such general contractor is providing such services for an ultimate consumer located outside this state and the benefit of such services are to be reaped outside this state, the charges for such services are not subject to the sales tax.

Although X will not be required to collect a sales tax on charges for otherwise taxable services performed solely for the benefit of the foreign based consumer, where such services benefit X, X must either pay the sales tax to the subcontractors or it must self-assess a use tax on the amount paid for such services.


January 24, 1990