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Are storage charges taxable on sales made to a customer in California? We have nexus in California

Full Question: Are storage charges taxable on sales made to a customer in California? We have nexus in California

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Answer:

Diane Yetter photoCalifornia imposes its sales tax on the sale of tangible personal property. The sales tax generally does not apply to charges for services as long as they are separately stated. Therefore, if the charge is for the storage of property by your company for a customer and it is separately stated from the charge for the goods, then this should generally be exempt from tax. Note that the storage of goods in California constitutes a use of the goods and therefore goods stored in California are subject to tax as they come to rest and are used in California. This does not mean the charge for storage is taxable.

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