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Time to Tax Repairs in North Carolina

  • Dec 3, 2015 | Gail Cole

 Watch repair labor and services to be taxed in North Carolina, March 2016.

It will soon be time to tax repair services in North Carolina. Effective March 1, 2016, labor and service charges for repairs of watches, clocks and jewelry are subject to state and local sales tax. Charges for materials, currently subject to sales tax, remain taxable.

Until March 1, 2016, separately stated labor and service charges are exempt from sales and use tax, which applies only to charges for materials furnished in connection with the work. In the event labor and service charges are combined with charges for materials, repairmen are entitled to collect and remit sales tax on 10% of the combined price or charge. The 10% represents “the retail charge for the materials furnished.” Additional information.

This change in tax policy is due to the enactment of S.L. 2015-241, which calls for the repeal of 17 NCAC 07B . 1003.

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Sales tax rates, rules, and regulations change frequently. Although we hope you'll find this information helpful, this blog is for informational purposes only and does not provide legal or tax advice.
Gail Cole
Avalara Author
Gail Cole
Gail Cole
Avalara Author Gail Cole
Gail began researching and writing about sales tax in 2012 and has been fascinated with it ever since. She has a penchant for uncovering unusual tax facts, and endeavors to make complex sales tax laws more digestible for both experts and laypeople.