How to invoice in Ohio

Ohio taxes a list of services

Ohio’s state sales tax is 5.75 percent, and counties add more. The state taxes a defined list of services in addition to goods. The Department of Taxation’s list includes lawn care and landscaping, building maintenance and janitorial services, and exterminating (pest control), as well as repair and installation of tangible property.

If you run a lawn crew, a cleaning business or a pest service, tax likely applies to what you charge and belongs on its own line of the invoice. Contractors who build on or repair real property are generally treated as the consumers of their materials. Ask the Department of Taxation about your work before you decide.

Municipal income tax on business profits

Ohio cities levy their own income tax, and businesses generally owe it on net profits earned in the city. If you work in several cities you may file in more than one. Your invoices are the record of income for each, so keep them organized by job address. The Ohio Business Gateway handles much of the state filing.

Licences

Ohio has no general contractor licence at the state level. The Ohio Construction Industry Licensing Board, in the Department of Commerce, licenses commercial electrical, plumbing, HVAC, hydronics and refrigeration contractors, while residential work is often licensed or registered locally. Print any licence number on your invoice, and check with your city or county.

Sales made at the customer’s home

Ohio’s Home Solicitation Sales Act can give customers a three-day right to cancel for some sales made at their home, and the contract has to say so in specific words. The Attorney General’s office has the notice language and the exceptions. If you sell at the door, read it first.

Registering to collect Ohio sales tax

A business that sells taxable goods or services in Ohio holds a vendor’s license, which you apply for through the Ohio Business Gateway. With it you collect tax from customers and file returns on the schedule the Department of Taxation sets for you. If your work is lawn care, cleaning or pest control, start here before your first invoice.

Some customers, such as nonprofits and resellers, may claim an exemption. Ask them for a completed Ohio exemption certificate and keep it with your records, because the Department of Taxation will want to see it if the sale is ever checked. An invoice with no tax line and no certificate on file can cause problems in an audit.

The invoice

• Business name, address, phone and any licence number.
• Customer name and the service address, which also tells you the city for local tax.
• Services and goods on separate lines, with the tax line where it applies.
• Due date and a link to pay.

Pages for lawn care, cleaners and plumbers show how each trade invoices. See the pricing or try the demo. Late fees and deposits: check local rules. General information, not legal or tax advice.

Official sources

Check the rules with the people who write them:

• Ohio Department of Taxation: tax.ohio.gov
• Ohio Construction Industry Licensing Board: com.ohio.gov
• Ohio Attorney General: ohioattorneygeneral.gov

Rules change and this page is a starting point. Confirm with your state revenue department and licensing board before you rely on it.