Tennessee – Guidance Issued On Taxable Sales Of TPP By Service Providers Exempt From Business Tax

SALT Report 3514 – The Tennessee Department of Revenue has issued guidance to clarify tax obligations for businesses primarily providing exempt services.  Business tax must still be paid on sales of tangible personal property and taxable services.

  • A provider of exempt services is exempt only on the receipts from those exempt services.
  • A provider of exempt services is subject to business tax on its sales of tangible personal property and/or taxable services.
  • Business classification is based on taxable sales.
  • Providers of exempt services who have a business tax liability on other sales can request to enter a Voluntary Disclosure Agreement.