Is a fee paid to a contract draftsman who is hired only to review/check the work of a company's own staff draftsmen, without producing any drawings themselves, taxable in Texas?

Plain-English summary

A company that employs its own staff draftsmen also hires outside contract draftsmen specifically to check the work of those staff draftsmen — the contract draftsmen don't produce any drawings or other tangible personal property themselves; their job is purely reviewing and checking existing work. The company asked whether the charge for that contract-draftsman review work is taxable.

The Comptroller's answer was direct: the charge for a contract draftsman to check the work of staff draftsmen is not subject to Texas sales tax.

What this means for you

Engineering, architecture, and design firms

Purely reviewing or checking drawings produced by your own staff — without producing any new drawings or tangible deliverables — is a nontaxable service. This is distinct from hiring a draftsman to actually create or modify drawings, which could implicate different rules depending on whether tangible personal property changes hands.

Contract draftsmen and quality-control reviewers

If your engagement is limited to checking/reviewing existing work product rather than producing your own drawings, your fee for that work isn't subject to Texas sales tax.

Accountants and tax professionals

The key fact driving this letter's holding is narrow and specific: the contract draftsman produces NO tangible personal property (no drawings). Watch for that distinction if a client's facts shift — a draftsman who also produces or revises drawings as part of the engagement may face a different analysis.

Common questions

Q: Is hiring an outside draftsman to review my staff's drawings taxable?
A: Not according to this letter, as long as the contract draftsman only checks existing work and doesn't produce any drawings or other tangible personal property.

Q: Would the answer change if the contract draftsman also revised or produced drawings?
A: This letter only addresses pure review/checking work with no tangible output — a fact pattern involving actual drawing production wasn't addressed here and would need separate analysis.

Source

• STAR search: https://star.comptroller.texas.gov/search?doc_type_code=L&tax_type_code=SST
• Opinion: https://star.comptroller.texas.gov/view/200005354L

Original ruling text

May 24, 2000

Dear **:

Thank you for your recent fax regarding draftsmen and Texas sales tax.

You stated that your company employs draftsmen. In addition, you hire contract
draftsmen to check the work of the staff draftsmen. The contract draftsmen do
not produce any drawings or other tangible personal property.

The charge for the contract draftsmen to check the work of your staff draftsmen
is not subject to Texas sales tax.

This opinion is based on the facts presented. Additional or different facts
may yield different results.

You may call me toll free 1-800-531-5441, extension 5-9787, if you have any
questions or need more information. The direct line is 512/305-9787. You may
also write to Tax Policy Division, Comptroller of Public Accounts.

Sincerely,

Philip Knisely
Tax Policy Division