home home Doing business home Business types home Industry specific guides home Denturists Denturists

This guide is intended to help denturists licensed under Chapter 18.30 Revised Code of Washington (RCW) understand their excise tax liability in the state of Washington.


Updated January, 2011

Contents

Common Terms

Business and Occupation (B&O) Tax 
B&O tax applies to the gross amount received from conducting business in Washington.  There are different reporting classifications for various business activities such as retail sales, wholesale sales, and professional services.  Each classification has its own tax rate. 

Dental Prostheses
Dental prostheses are replacement, corrective, or supportive devices, worn to:

     (a) Artificially replace a missing portion of the mouth;
     (b) Prevent or correct a physical deformity or malfunction; or
     (c) Support a weak or deformed portion of the mouth.

They are exempt from retail sales and use taxes if the dental prosthesis meets the requirements for "prosthetic device" in RCW 82.08.0283 and 82.12.0277. Exempt items include, but are not limited to, full and partial dentures, crowns, inlays, fillings, braces, retainers, collars, wire, screws, bands, splints, night guards, gold, silver, alloys, acrylic materials, filling material, reline material, cement, cavity liner, pins, and endo post.

Denture
A denture is a removable full or partial upper or lower dental appliance to be worn in the mouth to replace missing natural teeth.

Denturist
A denturist is a person licensed under Chapter 18.30 RCW to engage in the practice of denturism.

Retail Sales Tax
Retail sales tax is a tax imposed on the buyer of goods and retail services. Sellers are responsible for collecting the tax from the consumer and remitting the tax to the Department of Revenue.  The term “sales tax” refers to the combined state and local portion of the tax.  

RCW
Revised Code of Washington (Washington statutes or laws).

Use Tax
Use tax is a tax imposed on the use of goods in this state as a consumer when the goods are purchased or acquired without payment of this state's retail sales tax. With respect to the use of goods as a consumer, either sales tax or use tax applies, but not both. In this manner, use tax serves to complement the sales tax. Like the sales tax, the use tax is a combined state and local tax. Use tax rates and sales tax rates are identical.

WAC
Washington Administrative Code (administrative rules).


Business and Occupation (B&O) Tax

Manufacturing B&O Tax

The production or fabrication of dentures, or other products (mouth guards, etc.) by a denturist is a manufacturing activity. 

  • Manufacturing of Dentures or Other Products
    Denturists must report manufacturing B&O tax on the value of the dentures or other products they manufacture. The value of products manufactured is generally the gross selling price of these products.

  • Manufacturing of Dental Casts, Models, and Other Items for Commercial or Industrial Use
    Denturists typically manufacture dental casts, models, or other items that they use in producing or fabricating dentures or other products.  The denturist is manufacturing a product for their own commercial or industrial use and is subject to the manufacturing B&O tax on the value of the dental cast, model, or other item. (See WAC 458-20-112 (Value of products) for information regarding the value of products.)  

For additional information about the manufacturing B&O tax, see our Manufacturing Guide and WAC 458-20-136 (Manufacturing, processing for hire, fabricating).

Retailing and Wholesaling B&O Tax

Denturists must report retailing B&O tax on all sales of dentures and all other tangible personal property (mouth guards, denture adhesive, denture creams, denture cleaners, toothpaste, mouthwash, etc.).

However, if a denturist sells products to a person that intends on reselling the products and that person gives the denturist a valid reseller permit, the denturist should report those sales under the Wholesaling B&O tax classification.

Multiple Activities Tax Credit (MATC)

Denturists must report under the Manufacturing B&O tax classification (production activity) and the Retailing and/or Wholesaling B&O tax classifications (selling activity).  However, a MATC may be reported so that B&O tax is only paid once on the same product.  A business must complete the Multiple Activities Tax Credit (Schedule C) each time the credit is claimed and attach it to their excise tax return. See WAC 458-20-19301 for a more detailed explanation of the MATC.  


Retail Sales Tax: Sales Made by Denturists

Sales of Dentures and Other Dental Prostheses

Sales of dentures are exempt from retail sales tax.  Revised Code of Washington (RCW) 82.08.0283 provides a retail sales tax exemption for the sale of prosthetic devices.  Dentures meet the definition of a prosthetic device as defined in RCW 82.08.0283(4)(a).

When making tax-exempt retail sales of dental prostheses to dentists, other medical practitioners, nursing homes, and hospitals, a denturist must obtain a Buyers' Retail Sales Tax Exemption Certificate to substantiate the exempt nature of any sale.  The certificate must be properly completed, with the “Prescription items” box checked (item a. under section 6 “Other”) and a general description of the items written in the space.

Sales of Mouth Guards or Similar Devices Manufactured by Denturists

Sales of mouth guards or similar devices are subject to retail sales tax unless specifically exempt by Washington law.  A mouth guard or similar devices would be exempt from retail sales tax if they meet the definition of a prosthetic device as defined in RCW 82.08.0283(4)(a). 

For example, mouth guards that solely provide protection or enhancement in a sports environment do not qualify as a dental prostheses and the sale of these types of mouth guards would be subject to retail sales tax.

However, a mouth guard that is created for a specific person and is used by that person as a night guard to prevent chronic tooth grinding during sleep would qualify as a dental prosthesis and would be exempt from sales and use tax.

Sales of Other Items and Products by Denturists

Denturists must collect retail sales tax on all sales of tangible personal property (denture adhesive, denture creams, denture cleaners, toothpaste, mouthwash, etc.), unless the sale is specifically exempt under Washington law.


Retail Sales Tax: Purchases by Denturists

Generally, purchases of equipment, supplies, and other items used by denturists in performing their services are purchases at retail and subject to retail sales tax unless specifically exempt by law as discussed below.  If the seller does not collect retail sales tax, the denturist must remit the retail sales tax or use tax directly to the Department of Revenue.


Purchases of Components of Dentures or Other Products (Mouth Guards, etc.) Produced for Sale

Purchases of supplies by denturists that become components of dentures and other products that are produced or fabricated for sale are purchases at wholesale and are not subject to retail sales tax if the denturist provides the seller with a valid reseller permit.

Reseller Permit

Denturists may use a reseller permit to purchase supplies and other items the denturist intends to resell.  This includes supplies like denture adhesive, denture creams, denture cleaners, etc. that are resold by a denturist to end consumers.

For more information on the reseller permit and how to apply for one, see our webpage on the reseller permit.

Manufacturer’s Sales/Use Tax Exemption for Machinery and Equipment (M&E)

The Manufacturers' Sales and Use Tax Exemption (M&E) applies to purchases by denturists of qualifying machinery and equipment used directly in their manufacturing operation with a useful life of one year or more. The exemption also applies to charges for labor and services for installing, repairing, cleaning, altering, or improving qualifying machinery and equipment.  This exemption is limited to machinery and equipment used to manufacture products for sale as tangible personal property.

  • Manufacturing of Dentures or Other Products 
    The exemption is available for purchases of qualifying machinery and equipment used by denturists to manufacture dentures and other products for sale.

  • Manufacturing of Dental Casts, Models, and Other Items for Commercial or Industrial Use
    This exemption is not available for machinery and equipment used to manufacture these types of products because they are manufactured for commercial or industrial use by the denturist and are not themselves for sale.

 See our Manufacturing Guide and WAC 458-20-13601 for more detailed information regarding the M&E.

Use Tax

Use tax is a tax imposed on the use of tangible personal property in Washington when sales tax has not been paid. It is computed at the same rate as the sales tax. Unless specifically exempt by law, all tangible personal property purchased or used in this state is subject to either the sales tax or use tax, but not both, regardless of where or from whom the property is purchased.

Dental Casts, Models, and Other Items Manufactured by Denturists for Commercial or Industrial Use

Denturists typically manufacture dental casts, models, or other items that they use in producing or fabricating dentures or other products. Denturists are considered the consumer of these items and therefore are liable for use tax on the value of these items.  See WAC 458-20-112 for information regarding the value of products.

Special Circumstance: Denturist Businesses that Employ or Work with In-House Dentists/Oral Surgeons

Some denturist businesses may employ or work with an in-house dentist or oral surgeon.  The dentist or oral surgeon performs dental/medical services separate and apart from the denturist activities.  Customers that receive dentures from the denturist business may or may not receive dental/medical services from the dentist or oral surgeon.  The services received depend on the needs of the customer.   

Tax Treatment

A denturist business must be able to separate the dental/medical services provided by a dentist or oral surgeon from the manufacturing of dentures and any other activities performed by the denturist.  A denturist business in these situations must keep adequate records and documentation to show that the dental/medical services provided by a dentist or oral surgeon are separate from the services provided by the denturist.  The Department will look at these situations on a case by case basis. 

If a denturist is able to separate the dental medical services from the services provided by the denturist, the denturist may report service and other activities B&O tax on just the charges for the dental/medical services provided by the dentist or oral surgeon.

If a denturist is unable to separate dental/medical services from services performed by the denturist, all charges, including charges for the manufacturing of dentures, will be considered to be dental/medical services provided by a dentist.  When a denturist cannot separate the dental/medical services from denturist services, the denturist:

  • must report service and other activities B&O tax on all charges, including charges for the manufacturing of dentures;
  • pay retail sales tax on all purchases of equipment and supplies, including supplies that become components of dentures, unless specifically exempt by law;
  • is not eligible for the Manufacturers' Sales and Use Tax Exemption.

For more information on the specific tax reporting requirements of dentists and other healthcare professionals, see WAC 458-20-151.

Example
John Smith is a licensed denturist and owns ABC Dentures (ABC).  ABC also employs an in-house dentist.  Jane Doe visits ABC interested in purchasing some dentures.  After visiting with Ms. Doe, ABC’s dentist determines that Ms. Doe will need to have some dental work done prior to ABC making dentures for Ms. Doe.  ABC’s dentist performs the dental work and ABC bills Ms. Doe for the dental services.  After the dental work was completed, Mr. Smith begins the process of making dentures for Ms. Doe.  The dentist does not provide any additional services to Ms. Doe.  Shortly thereafter Mr. Smith completes the dentures for Ms. Doe.  ABC kept detailed records of all services provided by the dentist, services provided to make the dentures, and separately billed Ms. Doe for the dental services.

In this situation ABC did separate the dental services provided by the dentist from the manufacturing of the dentures for Ms. Doe because Ms. Doe was separately billed for the dental services, ABC kept detailed records all services provided to Ms. Doe, and the process to make the dentures for Ms. Doe occurred after the dental services were completed by the dentist.   ABC should report the gross proceeds from the sale of the dentures to Ms. Doe under the Manufacturing and Retailing B&O tax classifications and should report the charges for the dental work under the Service and Other Activities B&O tax classification.