Information Guide

Identifying Information:EDU-30
Tax Type:Kansas Retailers' Sales Tax
Brief Description:Lawn & Garden Care, Pest Control, Fertilizer Application, Landscaping & Retail Sales
Keywords:
Approval Date:03/16/2007


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KANSAS DEPARTMENT OF REVENUE


EDU-30 - Sales Tax Guidelines for Lawn & Garden Care, Pest Control, Fertilizer Application, Landscaping and Retail Sales

Nontaxable Services
Kansas tax law does not impose a sales tax on fees charged for providing any of the following services:
●lawn mowing & trimming
●aerating
●dethatching
●tilling, plowing & soil preparation
●raking (including power raking)
●tree, bush, shrub & stump removal
●tree, bush and shrub trimming & pruning
●stump grinding
●snow shoveling & plowing
●applying ice-melt or sand to driveways, sidewalks or parking lots
●hauling away brush, debris
●soil analysis testing
●back-flow testing

Pest Control & Fertilizer Application
The application of herbicides, pesticides or fertilizers within the state of Kansas is a taxable service. Anyone applying herbicides, pesticides or fertilizers in, on or around homes, businesses or commercial property for a fee must charge their customer Kansas sales tax. No Kansas sales tax is due on the application of chemicals, fertilizers, or other substances on agricultural property.
The rate of sales tax due is the rate in effect where the application is made. For a complete list of current sales tax rates for all taxing jurisdictions in Kansas see, Publication KS-1700, Sales Tax Jurisdiction Code Booklet. This publication, as is all publications, is available from the Kansas Department of Revenue’s web site: www.ksrevenue.org.
Sales tax should be charged on the total amount charged the customer for applying the herbicide, pesticide or fertilizer, to include trip charges, fuel surcharge, etc., including fees charge for application at a residence.
The applicator (retailer) may purchase the herbicides, pesticides or fertilizers intended for application exempt from Kansas retailers’ sales or compensating use tax with a Kansas Resale Exemption Certificate. See Publication KS-1520, Kansas Exemption Certificates.
Purchase of equipment or machinery to apply said herbicides, pesticides or fertilizers is subject to Kansas sales or compensating use tax.
Applicators should obtain a “Tax Exempt Entity Exemption Certificate”, issued by the Kansas Department of Revenue from any entity that claims to be exempt from sales tax. No exemption certificate = sales tax must be collected.
No sales tax is due if the applicator is applying herbicides, pesticides or fertilizers on a project for which the customer provides a Project Exemption Certificate issued for that project by the Kansas Department of Revenue.

Landscaping ●building a deck, gazebo or water garden
●installing a walkway, sidewalk or driveway
●installing edging, poly or rock in landscape beds
●installing lighting
●planting flowers, shrubs, trees
●applying sod or seed
●installing timbers or building retaining walls
●installing irrigation or sprinkler systems
●topdressing an area with soil, rock, sand or fill Retail Sales
If you sell shrubbery, plants, sod, trees, bushes, flowers, chemicals, fertilizers, garden materials, etc., without installation, you must collect sales tax of the total selling price (including delivery or shipping charges) when the customer takes deliver in Kansas. In like manner, if you sell or rent equipment within the state of Kansas, sales tax is due on the total selling or rental price. The rate of sales tax due is the rate in effect where the customer takes delivery. See Publication KS-1700. Retailers should purchase their inventory without sales tax by providing their supplier with a Kansas Resale Exemption Certificate. See Publication KS-1520.

Contractor/Retailers
Landscape contractors typically provide materials, plants, trees, etc. and install them. Retailers sell these items without installation. Contractor/retailers do both. Contractor/retailers should purchase their entire inventory without sales tax by providing their supplier with a Contractor/Retailer Exemption Certificate. See Publication KS-1520.
When a contractor/retailer makes a retail sale (no installation) - Kansas sales tax should be collected on the total selling price – including delivery charges. A Kansas sales tax exemption certificate should be taken from the seller for all exempt purchases and retained in the retailer’s records for at least 3 years. The rate of sales tax due is the Kansas sales tax rate in effect where the customer takes delivery.
When a contractor/retailer provides the materials and installs or applies them - Kansas sales tax is due on cost of materials removed from inventory for installation in construction jobs – even when the material will be subsequently removed from the state of Kansas and installed in another state. A contractor/retailer may only provide the materials without sales tax when the purchaser provides a Project Exemption Certificate. The rate of sales tax due is the Kansas sales tax rate in effect where the item is removed from inventory. Contractor/retailers would report the materials, at cost, on their Kansas retailers’ sales tax return. See Publication KS-1525 for an example.


Miscellaneous
Compensating Use Tax – Compensating use tax is due whenever an item purchased outside of Kansas is stored, used or consumed within the state of Kansas and no sales tax has been paid, or if one has been paid, it was at a lower rate of tax than the Kansas Sales/Compensating tax rate that is in effect at the location where the item will be used, stored or consumed. Compensating use tax is not due on inventory items that will be sold at retail. However, landscape contractors purchasing materials, supplies, equipment, etc. from outside of Kansas and using, storing or consuming them (by installing those materials for their customers) within Kansas are legally required to report and remit Kansas compensating use tax. To register for Kansas Compensating Use tax, see Publication KS-1216, Kansas Business Tax Application.

You must report and remit Kansas Compensating Use Tax when you:
●buy (or rent) equipment, supplies, materials directly or by mail, internet or phone order from a seller located outside of Kansas for use in Kansas – such as in a Landscaping Contract.
● buy (or rent) equipment, supplies, materials in another state for use in Kansas and the other state’s sales tax paid is lower than the Kansas sales/compensating use tax rate (the rate in effect where the item will be used, stored or consumed).
●buy items exempt from Kansas sales tax with a Kansas Resale Exemption Certificate (items purchased for resale) but, take the item(s) out of inventory for personal use.

Project Exemption Certificates – A Project Exemption Certificate (PEC) is issued by the Kansas Department of Revenue for specific projects. The requestor must complete an application (Form PR-76 or PR-70b found in Publication KS-1520) for each and every project. Application may be made on-line at KDOR’s web site. A PC allows contractors and subcontractor to purchase all materials without sales or compensating use tax and for all labor to install those materials without collecting sales tax. See Publication KS-1525 for additional information.




References – All are available from the department’s web site: www.ksrevenue.org
EDU-26, Sales Tax Guidelines for Contractor and Contractor-Retailers
EDU-27, Sales Tax Guidelines for Fabricators
EDU-28, Sales Tax Guidelines Businesses that Sell and Service Appliances and Electronic Products
EDU-29, Sales Tax Guidelines for Contractor-Fabricators and Contractor-Manufacturers
Publication KS-1216, Kansas Business Tax Application
Publication KS-1510, Kansas Sales and Compensating Use Tax
Publication KS-1520, Kansas Exemption Certificates
Publication KS-1525, Sales and Use Tax for Contractors, Subcontractors & Repairmen
Publication KS-1700, Sales Tax Jurisdiction Code Booklet




Date Composed: 03/16/2007 Date Modified: 03/16/2007