Oklahoma Administrative Code
Title 710 - Oklahoma Tax Commission
Chapter 65 - Sales and Use Tax
Subchapter 19 - Specific Applications and Examples
Part 1 - "A"
Section 710:65-19-11 - Automotive repair

(a) Lump-sum charge for automotive repairs. Automotive repair shops, service centers and body shops ("repair shops") that charge customers a single price for parts and labor should not collect sales tax from their customers, but instead should pay sales tax to suppliers when purchasing parts, materials and other property used to perform repair service. For example, a repair shop performs a windshield replacement for the lump-sum price of $150.00. The repair shop should pay tax when buying the windshield, gasket, and other items used in the repair, and should not collect tax on any portion of the $150.00 charge to the customer. If a repair shop erroneously charges sales tax, it must remit the tax collected in error or refund the tax to its customer even when sales tax was previously paid on the purchase of the items used in the repair.

(b) Separately stated sales of parts and other property. Repair shops making sales of parts and other property and separately charging customers for labor or installation are required to hold a sales tax permit and collect sales tax on the gross receipts attributable to the sales of parts and other property. Separately stated labor/installation charges are not subject to sales tax. Pursuant to its sales tax permit, a repair shop can purchase parts and other property which are furnished to customers in connection with the automobile repair service without the payment of tax. For example, if a repair shop replaces a car windshield for $50.00 labor and $100.00 for a windshield and gasket, it can purchase the windshield and gasket exempt from sales tax and must collect tax on the $100 separately stated charge for parts.

(c) Body shops deemed consumers of certain materials. Repair shops are considered the consumer of certain materials outlined in paragraphs (1) and (2) of this subsection utilized in performing repair services and must pay tax on these items at the time of purchase.

(d) Erroneously charged sales tax. If a repair shop charges and collects sales tax in error, it must remit the tax collected in error or refund the tax to its customer.