Altering, improving, installing, cleaning, normal maintenance procedures, and painting are all taxable in the same manner as a repair.
Repairs on vehicles for consumers are retail sales and are subject to tax under the Retailing classification of B&O tax on the total charge made for the repair. Retail sales tax must also be collected on the total charge.
For repairs covered by warranty, see Warranties.
Charges for repairs performed for persons who will resell the repaired vehicle to another are subject to tax under the Wholesaling classification of B&O tax. A reseller permit must be given to the company performing the repairs. For sales after Jan. 1, 2010 the resale certificate was replaced by the reseller permit. For further information refer to Reseller Permits.
Repairs performed in Indian country on vehicles belonging to Native Americans are not subject to retail sales tax or Retailing B&O tax.
Repairs performed outside of Indian country are subject to sales tax and B&O tax.
However, repairs performed outside of Indian country on vehicles belonging to Native Americans are not subject to the retail sales tax if the seller delivers the vehicle inside Indian Country. The income should be reported on the excise tax return and a deduction should be taken on the deduction detail sheet under "Sales to Indians."
See Native Americans for more information.
Parts for repairs
Dealers may purchase parts to repair vehicles without paying the retail sales tax by providing a valid reseller permit to the vendor. For more information refer to Reseller Permits.
Equipment used for repairs
Diagnostic equipment, other equipment, and tools used by employees of the dealership to make repairs are subject to the retail sales tax at the time of purchase. If retail sales tax is not paid, the use tax must be paid on the excise tax return at the time the equipment is put to use in Washington.
Consumable supplies refer to supplies that are not resold to the customer. The dealership must pay retail sales/use tax on such supplies used or consumed while performing repairs to customers' vehicles.
- The customer brings in a vehicle for an oil change and lube job. As part of the service, all vital fluids are checked. The oil, oil filter, air filter, the lubricants, and all vital fluids may be purchased by the dealer using a reseller permit because they are resold to the customer.
- The customer brings in a vehicle to have its brakes repaired. The brake drum, pads, and shoes which are replaced may be purchased by the dealer using a reseller permit. The lubricants and the brake fluid may also be purchased for resale. The total charge to the customer is subject to the retail sales tax.
Certain nonresident exemptions
See Nonresidents for information about repairs for nonresidents.
Other exempt sales
Revised Code of Washington (RCW) 82.08.0273
Washington Administrative Code (WAC) 458-20-102
Washington Administrative Code (WAC) 458-20-173
Washington Administrative Code (WAC) 458-20-192
Excise Tax Advisory (ETA) 3054
Excise Tax Advisory (ETA) 3045