The place to find business sales tax information

— as well as solutions, services and jobs!

We are a small contractor operating in NY. What if we work with a subcontractor and we don't want to be charged sales tax on a capital improvement project?

Full Question: We are a small contractor operating in New York. If we have a subcontractor working for us and we don't want to be charged sales tax, when it's a capital improvement project, how do we complete the ST 124? Do we complete the customer section of that form and our subcontractor complete the contractor section?

Brought to you by:

NOTE: This site does NOT provide client-specific tax advice. Information provided is general and may NOT apply to your particular situation. Do NOT take any action based upon any site content until you have received advice from an independent, qualified tax practitioner with whom you have a professional-client relationship. All content is subject to our disclaimer.


Diane Yetter photoAs the prime contractor, you should obtain Form ST-124 - Certificate of Capital Improvement – from your customer and retain it for your records. When purchasing the services of a subcontractor for the capital improvement project, provide the subcontractor with a copy of the certificate from the customer. You do not complete and provide a separate Form ST-124 to the subcontractor. Each contractor is responsible for paying tax on the purchase of materials that are incorporated into the capital improvement.

(Not quite what you need? View SALES TAX QUESTIONS home page to access other topics or use site-wide SEARCH in upper right)


Access to any portion of is contingent upon your acceptance of our Terms of Use. This Web Site and content provided by STS Publishing, LLC and its third party content providers, including, but not limited to information, documents, forms, comments, advice and opinions, is for informational purposes only, and is not a substitute for professional advice, nor does the use of this Web Site constitute a professional-client relationship. The Web-Site also includes advertisements, directory listings, job postings and links to third party web sites, all of which are provided for your convenience only and in no way constitute a referral, endorsement, or warranty by of any product or service provided by such third parties. All content is provided “as is” with no guarantee regarding accuracy, suitability, or timeliness. Your reliance on any content accessed on or through the Web Site, or on any product or service provider is strictly at your own risk.