Oklahoma Administrative Code › Title 710 - Oklahoma Tax Commission › Chapter 65 - Sales and Use Tax › Subchapter 19 - Specific Applications and Examples › Part 1 - "A" › Section 710:65-19-11 - Automotive repair

Current through Vol. 41, No. 20, July 1, 2024
(a)
Lump-sum
				  charge for automotive repairs.
Automotive repair shops, service centers
				  and body shops ("repair shops") that charge customers a single price for parts
				  and labor should not collect sales tax from their customers, but instead should
				  pay sales tax to suppliers when purchasing parts, materials and other property
				  used to perform repair service. For example, a repair shop performs a
				  windshield replacement for the lump-sum price of $150.00. The repair shop
				  should pay tax when buying the windshield, gasket, and other items used in the
				  repair, and should not collect tax on any portion of the $150.00 charge to the
				  customer. If a repair shop erroneously charges sales tax, it must remit the tax
				  collected in error or refund the tax to its customer even when sales tax was
				  previously paid on the purchase of the items used in the repair.
(b)
Separately stated sales of parts
				  and other property.
Repair shops making sales of parts and other
				  property and separately charging customers for labor or installation are
				  required to hold a sales tax permit and collect sales tax on the gross receipts
				  attributable to the sales of parts and other property. Separately stated
				  labor/installation charges are not subject to sales tax. Pursuant to its sales
				  tax permit, a repair shop can purchase parts and other property which are
				  furnished to customers in connection with the automobile repair service without
				  the payment of tax. For example, if a repair shop replaces a car windshield for
				  $50.00 labor and $100.00 for a windshield and gasket, it can purchase the
				  windshield and gasket exempt from sales tax and must collect tax on the $100
				  separately stated charge for parts.
(c)
Body shops deemed consumers of
				  certain materials.
Repair shops are considered the consumer of certain
				  materials outlined in paragraphs (1) and (2) of this subsection utilized in
				  performing repair services and must pay tax on these items at the time of
				  purchase.
(1)
Tools, equipment and
				  supplies utilized by repair shops.
Materials such as shop rags, safety
				  glasses, sandpaper, masking tape, tools, equipment, and related items that are
				  not incorporated into the customer's automobile when the repair service is
				  performed.
(2)
Materials
				  transferred by repair shops to customers in irregular quantities.
Materials used in performing repair services which are transferred to customers
				  in varying volumes or amounts and which the repair shop has determined are
				  incapable of a fixed or definite sales price. The following is a nonexclusive
				  list of items that may be included in the described category of materials.
(A) Paint, primer, paint thinner
(B) Body filler
(C) Undercoating
(D) Spray on bed liner
(E) Lubricants and coolants
(F) Abrasives and or polishing
				  compounds
(G) Window
				  tinting
(H) Glues, resins,
				  sealants, and adhesives
(I)
				  Cleaning solvents and other related chemicals