What is tangible personal property?
Tangible personal property is personal property that can be perceived by any of the senses meaning it can be seen, felt, touched, or otherwise perceived by the senses. Some examples are jewelry, furniture, clothing, cars, scooters, shoes, computers, phones and purses.
Are repairs to tangible personal property taxed?
Repairs to tangible personal property can be taxed depending on a variety of factors. Generally, Florida law requires that sales tax be applied to any repair that requires the repairer to supply any materials to complete the repair. This applies even if the repairer does not charge the customer for the materials/parts.
If the repairs are performed without the need of any material/parts and the repairer can prove that they did not use any materials/parts, the transaction is tax exempt.
Are items that I ship to another state for repairs subject to sales tax?
If you ship an item to a repairer outside of Florida and it is shipped back to Florida once the repairs have been completed, the transaction is taxable. The only way that the transaction would not be deemed taxable is if the item is not returned to Florida.
What about the repairs of items that are covered under warranty or insurance?
If an item is covered under a manufacturer/factory warranty and the repairs are paid by the factory/manufacturer, the transaction would be tax exempt. If the item is covered under any sort of service warranty and the repairs are paid directly by the warranty issuer, the item is tax exempt. The repairer must keep detailed records in order for the transaction to be exempt. If any part of the cost is paid for by the owner of the item, the warranty holder, that specific amount is to be taxed, even if the holder gets reimbursed by the issuer.
If an item is covered by an insurance policy and the insurance company pays for the repairs, the transaction is taxable.
Is a repair that requires the installation of tangible personal property in my home subject to sales tax?
If the item that is installed into your home can be removed without being destroyed, the repair is subject to sales tax and any applicable surtax.
What tax rate applies to repairs to tangible personal property?
Most repairs that are taxable are subject to Florida’s typical tax rate of 6%, but depending on the county where the item is being delivered to after repair, discretionary sales surtax rate may apply.