New Jersey: The Taxation of Dog Training Services
- Sep 11, 2013 | Gail Cole
A master dog trainer located in New Jersey Division of Taxation to learn whether or not the services he provides are subject to sales tax. A Letter Ruling was issued in response.
The following services are provided by the master dog trainer:
- Professional dog training services offered in a group setting, with dogs and owners in attendance;
- Dog sitting services (including training) both in the client's home and at the dog trainer's facilities; and
- Dog selling. The trainer purchases dogs, trains them, and then sells them to clients.
The NJ Division of Taxation made the following determinations, based on pertinent NJ law:
- Charges for teaching professional dog training classes are not subject to sales tax, no matter where they are held.
- Charges for dog sitting services in the client's home are not subject to sales tax. However, charges for boarding a dog at the trainer's facilities are subject to sales tax. This is true both for overnight boarding and day care.
- The trainer may use an exemption certificate to purchase dogs for resale without sales tax. He must then charge sales tax when selling the trained dog to a client, even if the training services are separately stated. While training services are normally exempt, since they are in this instance part of the sales price of the dog, they are taxable.
Letter Rulings are only binding on the Division of Taxation "with respect to the person or entity to whom it is issued and only if the person or entity fully and accurately describes all the relevant facts." That said, they are instructive. Read the complete Letter Ruling discussed above here.
Although most dog training services are exempt from sales tax in New Jersey, sales tax is being extended to more services in many states around the country. For example, New Jersey taxes information services, while Minnesota taxes telecommunication services.
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