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Old 08-13-2015, 09:34 AM   #2
XDCX
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Join Date: Nov 2007
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In my experience, Scenario 1 and Scenario 2 are pretty clear cut.

In Scenario 1, the Dealership wouldn't be expected to pay sales tax to ABC Tire Company because they'll be charging the retail customer sales tax on the tires when the customer pays their bill for the entire repair order.

In Scenario 2, the Dealership would be expected to pay sales tax to ABC Tire Company because the tires will essentially be consumed by the Dealership - they'll never be charged out on a Repair Order that will be subject to sales tax.

For me, Scenario 3 and Scenario 4 are less clear cut.

In Scenario 3, I'm guessing that the Dealership wouldn't be expected to pay sales tax to ABC Tire Company since the ultimate buyer of the used car will be paying sales tax on the car and the value of the car was enhanced with the new tires.

In Scenario 4, I'm guessing that the Dealership would be expected to pay sales tax to XYZ Detail Company because the products that were purchased cannot be tied to a specific vehicle.

Do my impressions fit with how sales tax is charged/collected in your state?
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