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Beginning on January 1, 2014, NC rolled out a new sales and use tax. The tax applies to warranty agreements, service contracts and maintenance agreements that cover tangible personal property. The amount of the NC Sales and Use tax for these contracts is 4.75%. What is Tangible Personal Property?
The sales price of or the gross receipts derived from repair, maintenance, and installation services sold at retail is subject to the general State and applicable local and transit rates of sales and use tax. Repair, maintenance, and installation services is defined in N.C. Gen.
Services in North Carolina are generally not taxable, with important exceptions. If the service you provide includes creating or manufacturing a product, you may have to deal with the sales tax on products.
Effective March 1, 2016, N.C. imposes a sales tax on repair, maintenance, and installation services. Optional computer software maintenance contracts with respect to prewritten software that only provide support services that meet the definition of repair, maintenance, and installation services are fully taxable,
Traditional Goods or Services Goods that are subject to sales tax in North Carolina include physical property, like furniture, home appliances, and motor vehicles. Prescription Medicine, groceries, and gasoline are all tax-exempt.
Prescription Medicine, groceries, and gasoline are all tax-exempt. Some services in North Carolina are subject to sales tax.
The sales price of or the gross receipts derived from a service contract sold at retail is subject to the general 4.75% State, applicable local (2.00% or 2.25%), and applicable transit (0.50%) rates of sales and use tax. Service contracts are taxed in accordance with N.C. Gen. Stat. § 105-164.4I.
Yes. Retail sales tax applies to a service contract or warranty sold to a consumer (WAC 458-20-257).
The NC Department of Revenue says that if you are selling anything at retail (and thus collecting sales tax thereon), and you provide repair, maintenance, or installation services with respect to that item sold at retail, you are a retailer and will collect sales tax on labor.