California – New Tax Guide for Auto Repair Garages

SALT Report 2786 – The California State Board of Equalization released a tax guide for auto repair garage owners and operators to help them better understand the tax issues related to their industry.  The BOE stated that this particular industry is at a higher risk of audit as many owners and operators are unaware of the registration, reporting, and record-keeping obligations that are required under California’s state and local sales and use tax laws.

The tax guide is divided into the following sections each of which contains information specific to this industry.

Getting Started – This section discusses the State’s registration requirements, how to file tax returns, account maintenance, deadlines, and other fees and licenses that you may be subject to.  For example, auto repair garages may be required to register for the hazardous waste generator account, the California tire fee account, and the underground storage tank maintenance fee account.

Industry Topics – This section discusses the taxability of labor and service charges, core charges, nontaxable sales and purchases of parts, invoicing your customer, hazardous waste fees, oil recycling fees, and recordkeeping.

Specialty Repairs or Services – This section discusses the application of sales and use tax to smog checks and certifications, insurance work, painting and bodywork, glass replacement, tire sales and recapping, and work performed under warranty.

Resources – This section provides a variety of information such as, links to BOE sponsored videos and seminars, forms and publications, statutory and regulatory information, permit verifications, BOE office locations, city and county tax rates, and access to live help from BOE customer service representatives.

For Further Information

California State Board of Equalization – Tax Guide for Auto Repair Garages