34 Tex. Admin. Code § 3.311 - Auctioneers, Brokers, and Factors
(a)
Definitions. The following words and terms, when used in this section, shall
have the following meanings, unless the context indicates otherwise.
(1) Auction or auctioning--The sale by an
auctioneer of tangible personal property by competitive bid.
(2) Auctioneer--A person who owns tangible
personal property or to whom tangible personal property has been consigned and
who offers the tangible personal property for sale at auction.
(3) Broker--A person who brings other people
together to bargain for the sale or purchase of taxable items. In absence of
contractual provisions to the contrary, a broker:
(A) may not have possession of
property;
(B) cannot cause title of
property to be transferred to a purchaser without further action on the part of
its owner; and
(C) has disclosed to
the purchaser the identity of the broker's principal.
(4) Disclosed principal--A principal is
considered to be disclosed if before or at the time of sale the purchaser has
been given notice of the principal's identity.
(5) Factor--A person who sells taxable items
belonging to a principal on consignment. A factor:
(A) has possession and control of
property;
(B) can cause title of
property to be transferred to a purchaser without further action on the part of
its owner; and
(C) has not
disclosed to the purchaser the identity of the factor's principal.
(6) Principal--A person who
employs a broker or factor to act in the principal's behalf in negotiating with
a purchaser for the sale of a taxable item.
(b) Responsibility of an auctioneer.
(1) Sales tax is due from the purchaser on
the sales price of taxable items sold at auction.
(2) An auctioneer is responsible for
collecting and remitting to the comptroller any tax due on the sale of taxable
items sold at auction by the auctioneer.
(3) An auctioneer who does not receive
payment for the item sold, does not issue a bill of sale or invoice to the
purchaser of the item, and who does not issue a check or other remittance to
the owner of the item sold by the auctioneer is not considered a seller
responsible for the collection of the tax. In this instance, it is the owner's
responsibility to collect and remit the tax.
(4) An auctioneer should not collect tax on
the sale of items that are exempt from sales tax such as motor vehicles, real
property, or livestock.
(5) Sales
tax is not due on a sale of a taxable item when the owner of the item
subsequently reclaims the property at the auction.
(c) Letter of waiver. A person, who is
seeking an auctioneer's license and requires a letter of waiver as proof no
sales tax permit is required, may request a letter of waiver from the
comptroller.
(1) A request for a letter of
waiver from the comptroller as proof no sales tax permit is required must be in
writing and must detail the basis or reason no sales tax permit is
required.
(2) If the items being
auctioned are exempt from sales tax or if the auctioneer is not considered a
seller, a letter of waiver will be issued.
(3) A letter of waiver is valid only so long
as there is no change in the fact situation as originally presented to the
comptroller.
(d)
Responsibility of a broker.
(1) Sales tax is
due on sales solicited by a broker if the principal is a seller as defined by
Tax Code, §
151.008; and the sale would
not otherwise meet the definition of an occasional sale as found in §
3.316 of this title (relating to
Occasional Sales; Joint Ownership Transfers; Sales by Senior Citizens'
Organizations; Sales by University and College Student Organizations; and Sales
by Nonprofit Animal Shelters). The principal is responsible for collecting and
reporting the tax.
(2) Sales tax is
not due on sales solicited by a broker if the principal is not a seller and the
sale would otherwise meet the definition of occasional sale as found in §
3.316 of this title (relating to
Occasional Sales; Joint Ownership Transfers; Sales by Senior Citizens'
Organizations; Sales by University and College Student Organizations; and Sales
by Nonprofit Animal Shelters).
(e) Responsibility of a factor. Sales tax is
due on sales made by a factor. A factor is required to collect and report tax
on all sales.
(f) Reference.
Auctioneers and factors should refer to §
3.286 of this title (relating to
Seller's and Purchaser's Responsibilities).
Notes
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