Are boat and camper storage charges subject to Kansas sales tax?

Plain-English summary

An operator asked whether charges for boat storage and camper storage are subject to Kansas sales tax. The Department said these charges are not taxable.

Kansas sales tax applies to retail sales of tangible personal property and to a specific list of enumerated services. Storage charges — the rental of space for storage — are not on that list, so they fall outside the tax.

There is an important caveat, though: Kansas does tax maintenance and servicing. If the same operator services the boats or campers, or provides maintenance in connection with winter storage, those charges are taxable. In that case the operator must:

• register as a retailer and collect sales tax on the taxable service charges;
• separately state the taxable service charges from the nontaxable storage charges; and
• apply the local sales tax in effect where the services are performed.

What this means for you

Storage yards, marinas, and RV/boat storage operators

Pure storage — renting space to keep a boat or camper — is not taxable in Kansas. You do not charge sales tax on the storage fee itself.

When you also service or winterize

The moment you add maintenance or servicing (winterizing, repairs, upkeep), that portion becomes taxable. Break it out as a separate line item, register and collect tax on it, and use the local rate where you perform the work.

Bundled charges are a trap

If you lump a taxable service into one undivided "storage" charge, you risk having the whole amount treated as taxable. Separately stating the storage and the service keeps the storage portion nontaxable.

Common questions

Q: Do I charge Kansas sales tax to store someone's boat or camper?
A: No. Storage — the rental of space for storage — is not an enumerated taxable service in Kansas.

Q: What if I also winterize or service the boat?
A: Those maintenance/service charges are taxable. Separately state them from the storage charge and collect tax at the local rate where the service is performed.

Q: Do I need to register as a retailer?
A: If you provide taxable maintenance or service charges, yes — you must register as a retailer and collect sales tax on them.

Q: Does this ruling apply to my business?
A: A Kansas private letter ruling addresses only the requesting taxpayer's facts and cannot be relied on as precedent by others, though it shows how the Department separates nontaxable storage from taxable service.

Citations and references

• This ruling rests on the general Kansas rule that services are taxable only when specifically enumerated: storage and the rental of storage space are not enumerated (so they are not taxable), while maintenance and servicing are taxable and must be separately stated and collected at the local rate where performed. It does not turn on a single cited statute section.
• K.A.R. 92-19-59 — the regulation authorizing Kansas private letter rulings.

Source

• Landing page: Kansas Department of Revenue Policy Information Library
• Original document: P-2003-042

Original ruling text

Private Letter Ruling

Body:

Office of Policy & Research

October 13, 2003

XXXX
XXXX
XXXX

RE: Your letter received September 12, 2003

Dear XXXX:

Thank you for your recent letter. You ask if charges for boat storage and camper storage are subject to Kansas sales tax. Please be advised that these charges are not taxable. Kansas sales tax is imposed on certain enumerated services, as well as on retail sales of tangible personal property. None of the services listed in the statutes can be construed as including storage charges or the rental of space for storage.

Please note that Kansas does tax maintenance services. Therefore, if you service the boats or campers or provide maintenance for winter storage, the charges would be taxable. If you provide such services, you would be required to register as a retailer and collect sales tax on those charges. The taxable service charges should be separately stated from the nontaxable storage charges. The local sales tax on such maintenance or service charges would be the ones in place where the services are performed.

I hope that I have adequately answered all of your questions. If not, please call me at 785-296-3081. This is private letter ruling. It is based solely on the facts provided in your request. If it is determined that undisclosed facts were material or necessary to make an accurate determination by the department, this ruling is null and void. This private letter ruling will be revoked in the future by operation of law without further department action if there is a change in the statutes, administrative regulations, or case law, or a published revenue ruling, that materially affects this ruling.

Sincerely,

Thomas E. Hatten
Attorney/Policy & Research

Date Composed: 10/20/2003 Date Modified: 10/22/2003

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