Questions and Answers
Barbershops and beauty salons
Kansas Retailers' Sales Tax
Sales Tax for Barber Shops and Beauty Salons
SALES TAX for BARBER SHOPS
and BEAUTY SALONS
Hair and nail care services – NOT TAXABLE
Merchandise - TAXABLE
Kansas sales tax applies to the retail sale of tangible personal property (goods and merchandise) and the services of maintaining tangible personal property. People are not considered tangible personal property. Therefore, the services performed in barber shops and beauty salons are not taxable.
However, if your shop sells items of tangible personal property to your customers, you must register to
sales tax on these items. As the final consumer, you must also
sales or use tax on all supplies, equipment, and fixtures for use in your shop.
COMMONLY ASKED QUESTIONS
What is meant by the retail sale of tangible personal property?
Any merchandise (tangible personal property) sold to the final consumer (your customers) for their use outside of your business is considered to be a retail sale. Charge sales tax when selling these and similar items to your customers:
brushes, combs, scissors, hair dryers, cosmetics, manicure tools,
sculptured nails, nail polish, shampoos, conditioners, hair sprays
wigs, toupees, hair pieces
What do you mean by a taxable service?
Examples of non-taxable services provided by barber shops and beauty salons include cutting hair, dyeing hair, hair replacement, permanent treatments and shampooing hair.
A taxable service is one performed on tangible personal property, such as a shoe shine.
You charge $40 for a haircut and permanent. The customer also buys shampoo and conditioner for $12. Sales tax is charged only on the $12 of merchandise.
What about a manicure - is it taxable?
A manicure, like a hair cut, is not subject to sales tax. If you apply sculptured nails for a customer, this service is also not taxable. However, if you sell a package of sculptured nails and glue to the customer to take home, this is a sale of tangible personal property, and is taxable.
Can I pay the tax to my supplier and not charge the customer sale tax?
NO. Sales tax is due when the item is sold to the final consumer. Merchandise you stock to sell to the customer (resale inventory) should be purchased without tax using a resale exemption certificate (see below). Tax is collected when you sell the products to your customers.
What about the items I use in my shop?
You must pay sales tax or use tax on all items used in your business. Consumable supplies, such as shampoo, permanents, conditioners, and dyes will be taxed when you buy them from the wholesale house. Since you are the final consumer of these items necessary to provide a nontaxable service, you must pay sales tax on them. You must also pay sales tax on shop equipment and fixtures, such as barber chairs, shampoo stations, hair dryers, office supplies, waiting room furniture, towels, and magazines.
If you order shop equipment and fixtures from an out-of-state vendor shipped to you in Kansas, and the vendor does not charge you the 5.3% Kansas state sales tax, you must pay 5.3% Kansas use tax on these items direct to the Kansas Department of Revenue. If you buy these items while in another state and pay that state's sales tax of at least 5.3%, Kansas use tax is not due. Information about use tax is in our Publication KS-1510, "Kansas Sales and Compensating Use Tax."
How and when do I use an exemption certificate?
You will use a resale exemption certificate to buy the merchandise you intend to resell (resale inventory) to your customers. To use a resale certificate you must have a Kansas sales tax number and the items purchased must be sold in the regular course of your business. Use a consumed in production exemption certificate to purchase your shampoo, flea dips, or sprays, and other items consumed in the service of grooming.
Your supplier will keep the exemption certificate to show why he did not charge you sales tax. If you are a regular customer, your supplier may keep one certificate on file and not require a new copy with each purchase. You may also be asked to provide a copy of your Kansas sales tax registration certificate as proof of your sales tax number.
Exemption certificates are available from any of our offices or from our web site. Request a copy of our Publication KS-1520, "Kansas Exemption Certificates" for more detailed information on how to use exemption certificates as a buyer and as a seller.
How do I register to collect sales tax?
To register, obtain our Publication KS-1216, "Kansas Business Tax Application" and complete the application form. This booklet is available from any of our offices or from our web site. Allow 4 to 6 weeks for your application to be processed and a sales tax number to be issued. You must register and have a sales tax number prior to starting business.
When is my tax report due?
You filing frequency is assigned at the time of registration based on the anticipated volume of
business. Most barber and beauty shops report their sales tax monthly or by calendar quarters (Jan - Mar., Apr- June, etc.). Your tax return is due on the 25
of the month following the end of the reporting period. A return for the month of January is due February 25; a return for January - March quarter is due April 25.
AVOIDING COMMON MISTAKES
The department will send you a sales tax return, instruction sheet, and return envelope for each reporting period. If you report your sales tax quarterly, you will receive four returns during the calendar year. Here are some tips to help you avoid errors most often made in reporting and paying sales tax:
Tip #1. File a return for each reporting period, even when you have no tax to pay.
If you have had no sales for the reporting period, write NO SALES across the columns, sign, and mail the form.
Tip #2. DO NOT include the sales tax in the gross sales amount reported on line 1.
If your total sales figure
the sales tax collected on taxable sales, divide the taxable sales amount by 1.0 plus the tax rate before reporting your taxable and non-taxable sales total on line 1 of the sales tax return.
Your total sales are $10,630 and the tax rate in your area is 6.3%. Divide $10,630 by 1.063 = $10,000 sales without the tax to enter on line 1 of the sales tax return.
Tip #3 Complete all the applicable columns.
If the tax rate in your area includes a local sales tax (county and/or city), complete the county and city columns of the return
in addition to
the state column.
For example, if the tax rate in your area includes a 1% city tax, enter your gross sales, deductions, net sales and tax due figures in the city column as well as the state column of the return.
Tip #4. Do not include the cost of your inventory on line 2 of the return.
Line 2, "Merchandise Consumed by You, Purchased Without Tax" is used to report the cost (not the retail price) of items you remove from inventory to use
or to give as gifts, not the cost of inventory you have purchased and are holding for sale.
As a charitable contribution, you give a basket of hair care products from your inventory. The retail value of the basket is $40 but your cost is $25. Report $25 on line 2.
HELP AND ADDITIONAL INFORMATION
If you have questions about a tax issue or need assistance in preparing your report, contact the customer relations representatives in any of our offices.
Docking State Office Building
915 SW Harrison St., 3
Cloverleaf Office Park, Bldg. 3
6405 Metcalf Ave., Suite 120
State Office Building
230 E. William, Room 7150
Other informational publications, forms, and a calendar of FREE state business tax workshops are available from any of our offices, or from our web site:
KANSAS DEPARTMENT OF REVENUE
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