96-034

Response February 9, 1996

Request

February 9, 1996

XXXXX

RE: Advisory Opinion - Sales tax on storm doors

Dear XXXXX,

This letter is in response to your inquiry regarding sales tax on your purchase of storm doors. As we understand your situation, you are a real property contractor who sells and installs storm doors. You pay sales tax on your initial purchase of the doors. You asked whether you are required to charge sales tax to your customers. We find as follows:

The person who converts personal tangible property to real property is a real property contractor under Utah Administrative Rule R865-19S-58 (enclosed). It is the real property contractor, and not his customers, who is responsible for the sales tax on construction materials. Therefore, you are correctly paying sales tax on doors that you sell and install, and your customer is not required to pay sales tax.

If you sell a door without installing it, the outcome is different. Assume, for instance, that you sell a door to a customer who wishes to install it himself. In that case, you are not a real property contractor because you do not convert the door to real property. If you make a sale of this nature, you may purchase the door tax-free for resale, but you must collect sales tax from your customer. You must also obtain a sales tax license and remit the tax as required by law.

Please let us know if we can be of further assistance.

For the Commission,

Alice Shearer

Commissioner