Does Connecticut charge sales tax on services?

by TaxJar December 16, 2023

The majority of U.S. states require merchants to charge sales tax on tangible personal property (TPP), otherwise known as physical goods. Many states also implement sales and use tax on digital goods and SaaS. Because the economy has shifted over time from a manufacturing economy to a service economy, states are now looking to generate revenue by taxing services.

Here’s what merchants need to know about taxing services in the state of Connecticut, where the state sales tax rate is 6.35%.

Are services taxable in Connecticut?

There are many services that are taxable in Connecticut:

Advertising and public relations services
Business analysis, management, management consulting and public relations services
Cable and satellite television services
Car wash services, including coin-operated car washes
Computer and data processing services (at a reduced rate of 1%)
Cosmetic medical procedures
Credit information and reporting
Dry cleaning and laundry services
Employment agencies and agencies providing personnel services
Exterminating services
Flight instruction and chartering by a certificated air carrier
Furniture reupholstering and repair services
Health and athletic club services, including yoga instruction provided at a yoga studio
Intrastate transportation services provided by livery services
Janitorial services (including the cleaning of homes, offices and commercial property)
Landscaping and horticulture services
Lobbying or consulting services for the purpose of representing a client’s interests in relation to any governmental body
Locksmith services
Maintenance services to real property
Manicure services, pedicure services and all other nail services
Miscellaneous personal services, exclusive of services rendered by licensed massage therapists and licensed hypertrichologists
Motor vehicle repairs, including any type of repair, painting or replacement to the body or operating parts of a motor vehicle
Motor vehicle storage services, including the storage of motor homes, campers, and camp trailers
Motor vehicle towing and road services
Packing and crating services
Painting and lettering services
Parking services, including valet parking at airports, except metered space, in a lot with 30 or more spaces
Personnel training services when the training service provider is engaged by an employer to provide job-related training to personnel whose primary workplace is located in Connecticut
Pet grooming, pet boarding services, and pet obedience services
Photographic studio services
Piped-in music provided to business or professional establishments
Prepaid telephone calling services
Private investigation, protection, patrol work, watchman and armored car services, exclusive of these services provided by off-duty police officers and firefighters
Radio or television repair services
Refuse removal for commercial, industrial or income-producing property
Renovation and repair services to existing commercial, industrial and income producing property
Repair services to electrical or electronic devices, including, but not limited to, air-conditioning and refrigeration equipment
Repair or maintenance services to tangible personal property and contracts of maintenance, repair or warranty
Sales agent services for selling tangible personal property
Services to industrial, commercial and income-producing real property, including, but not limited to, management, repair and renovation services, and including voluntary evaluation, prevention, treatment, containment or removal of hazardous waste or other contaminants of air, water or soil
Sign painting and lettering
Spa services, regardless of where performed, including body waxing and wraps, peels, scrubs and facials
Stenographic services
Storage or mooring of any noncommercial vessel on land or in the water, except for the period of October 1 through May 31
Storage: The furnishing in Connecticut of space for storage of personal property by a person in the business of furnishing such space, excluding furnishing space used by a person for residential purposes
Swimming pool cleaning and maintenance services
Telecommunications services
Telephone answering services
Warranty and service contracts for any item of tangible personal property
Window cleaning services

Please keep in mind that this is a guideline, and you should consult with a sales tax professional to determine if the services your business provides should be taxed. For an in-depth look at Connecticut sales tax, TaxJar’s guide to Connecticut sales tax and the Connecticut Department of Revenue Services has more details.

How to stay compliant with sales tax when you sell services

Managing all the moving parts of sales tax can be challenging. Are accounting services taxed? What about hair care or car maintenance? They may not be taxed in your state today, but sales tax laws change all the time. TaxJar makes it easier for you to stay current with it all, especially as you scale your business across states.

If you need to charge sales tax on services, TaxJar takes all of these state laws into account and makes your job simple. To learn more about TaxJar and get started automating your sales tax compliance, start a free, 30-day trial today.