Does a veterinary clinic collect sales tax on pet food and pet supplies, and what about grooming — given the special veterinarian tax rules?

Plain-English summary

Guilderland Animal Hospital runs a satellite clinic (Crosstown Veterinary Center) that practices veterinary medicine, does grooming, and sells pet food and pet supplies. It asked how sales tax applies.

New York gives veterinarians a special set of rules under Tax Law § 1115(f) and Reg. § 528.24. The Department applied them:

• The vet's purchases are taxable. A veterinarian must pay sales tax on its purchases of tangible personal property — whether used in the practice of veterinary medicine, used in performing taxable services, or animal-care articles (medicine, collars, flea spray, food, brushes) — even if the vet later resells them. The statute specifically says a sale of such articles to a veterinarian is not a sale for resale.
• The vet does not collect tax on resales of animal-care items. Because the vet already paid tax when buying them, its subsequent sales of items directly related to the well-being of animals (collars, flea spray, brushes, food, medicine) to customers are not subject to sales tax.
• Grooming is taxable. Grooming (and clipping, boarding, etc.) are not covered by the veterinary-service exemption. So the clinic must register as a sales tax vendor and collect tax on its grooming receipts.

So the clinic registers as a vendor because of grooming, but it still follows the § 1115(f) pattern: pay tax on its purchases of pet food/supplies/medicine, and don't collect tax when reselling those animal-care items.

What this means for you

Veterinary practices

New York flips the usual resale rule for vets: you pay tax on the animal-care items you buy and don't charge tax when you resell them — the tax is collected once, at your purchase. Don't hand your suppliers a resale certificate for pet food, medicine, collars, and the like; you're the taxable consumer. Then don't add sales tax when you resell those animal-care items to clients.

Grooming and other non-medical services

The exemption is only for genuine veterinary medicine. Grooming, clipping, and boarding are taxable services — you must register as a vendor and collect tax on them. Selling non-animal-care merchandise (or pets themselves) is also taxable.

Accountants and tax professionals

The § 1115(f) / Reg. § 528.24 regime: (1) purchases by the vet are taxable, including animal articles that would otherwise be resale inventory; (2) resales of animal-care articles are not taxed (tax already paid); (3) non-professional services like grooming are taxable and trigger vendor registration and collection. Selling animals, or articles unrelated to animal care, is taxable.

Common questions

Q: Does a vet collect sales tax when it sells pet food or medicine to a client?
A: No, for animal-care items directly related to the animal's well-being. The vet already paid sales tax when it bought them, so it doesn't collect tax on the resale.

Q: Can a vet buy pet supplies tax-free for resale?
A: No. The statute says a sale of animal articles to a veterinarian is not a sale for resale, so the vet pays tax at purchase — even though it may later resell the items.

Q: Is grooming taxable?
A: Yes. Grooming is not part of the veterinary-medicine exemption, so the clinic must register as a sales tax vendor and collect tax on grooming charges.

Q: Can another taxpayer rely on this opinion?
A: No. An advisory opinion binds the Department only as to the petitioner and the facts described; another taxpayer with different facts cannot rely on it.

Citations and references

Statutes and authorities:

• Tax Law § 1105(a) (tax on receipts from retail sales of tangible personal property)
• Tax Law § 1115(f) (exemption for veterinary services; a sale of animal articles to a veterinarian is not a sale for resale)
• Sales and Use Tax Regulations § 528.24 (veterinarians — exemption, taxable transactions, and purchases)

Source

• Landing page: https://www.tax.ny.gov/pubs_and_bulls/advisory_opinions/sales_ao_1992.htm
• Opinion: https://www.tax.ny.gov/pdf/advisory_opinions/sales/a92_59s.pdf

Original ruling text

New York State Department of Taxation and Finance

Taxpayer Services Division
Technical Services Bureau

TSB-A-92(59) S
Sales Tax
July 30, 1992

STATE OF NEW YORK
COMMISSIONER OF TAXATION AND FINANCE
ADVISORY OPINION

PETITION NO. S920504A

On May 4, 1992 a Petition for Advisory Opinion was received from Guilderland Animal
Hospital, RD #2, Altamont, New York 12009-9526.
The issue raised by Petitioner, Guilderland Animal Hospital, is whether Petitioner is liable
for collecting sales tax on sales of pet food and pet supplies at Petitioner's satellite clinic, Crosstown
Veterinary Center, 2601 Curry Rd. Ext., Schenectady, NY 12303.
Petitioner's satellite clinic provides veterinary services six days per week, grooming services
and sales of pet food and pet supplies. The veterinary services rendered by Petitioner constitute the
practice of veterinary medicine as defined in the Education Law.
Section 1101 of the Tax Law states, in part:
Definitions.
(b) When used in this article for the purposes of the taxes imposed by subdivisions
(a), (b), (c) and (d) of section eleven hundred five and by section eleven hundred ten,
the following terms shall mean:
(4) Retail sale. (i) A sale of tangible personal property to any person for any purpose,
other than (A) for resale ...
Section 1105 of the Tax Law states, in part:
Imposition of sales tax. - ... there is hereby imposed and there shall be paid a tax ...
upon:
(a) The receipts from every retail sale of tangible personal property . . .
Section 1115(f) of the Tax Law states:
Services rendered by a veterinarian licensed and registered as required by the
education law which constitute the practice of veterinary medicine as defined in said
law, including hospitalization for which no separate boarding charge is made, shall
not be subject to tax under paragraph (3) of subdivision (c) of section eleven hundred
five, but the exemption allowed by this subdivision shall not apply to other services
provided by a veterinarian to pets and other animals, including, but not limited to,
boarding, grooming and clipping. Articles of tangible personal property designed for
use in some manner relating to domestic animals or poultry, when sold by such a
veterinarian, shall not be subject to tax under subdivision (a) of section eleven
hundred five or under section eleven hundred ten.

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TSB-A-92(59) S
Sales Tax
July 30, 1992
However, the sale of any such articles of tangible personal property to a veterinarian
shall not be deemed a sale for resale within the meaning of paragraph (4) of
subdivision (b) of section eleven hundred one and shall not be exempt from retail
sales tax.
Section 528.24 of the Sales and Use Tax Regulations states, in part:
(a) Exemption. (1) The exemption is allowed for services rendered by a licensed
veterinarian which constitute the practice of veterinary medicine, including
hospitalization for which no separate boarding charge is made.
(2) The exemption is not applicable to other services provided by a
veterinarian, including but not limited to boarding, grooming and clipping.
(3) The exemption is allowed for articles of tangible personal property
designed for use in some manner relating to domestic animals or poultry, when sold
by such a licensed veterinarian.
*

*

*

(c) Purchases by a veterinarian. (1) Purchases of tangible personal property
by a veterinarian for use in the practice of veterinary medicine and performing
taxable services are subject to tax.
(2) The purchase by a veterinarian of tangible personal property designed for
use in some manner relating to domestic animals or poultry is deemed a retail sale,
notwithstanding a subsequent sale of such items by the veterinarian.
Example 1:

The purchase of medicine, collars, flea
spray, food or brushes, whether used
by a veterinarian in performing a
service or sold to others, is subject to
tax at the time of purchase by a
veterinarian.

Example 2:

The sale by a veterinarian of collars,
flea spray, brushes, food and medicine
which are directly related to the well­
being of animals and pets is not
subject to tax.

(d) Taxable transactions. (1) Nonprofessional services performed by a veterinarian
are subject to tax.
Example 1:

Boarding, clipping and washing of
pets are services which are subject to
tax.

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TSB-A-92(59) S
Sales Tax
July 30, 1992
(2) The sale by a veterinarian of articles which are not related to the care and
maintenance of animals is subject to tax.
Example 1:

The sale of pets by a veterinarian is
subject to tax.

(3) Veterinarians who carry on taxable activities are required to register as
vendors, collect the tax and file returns.
In the instant matter, Petitioner is involved in practicing veterinary medicine at the satellite
clinic. Therefore under the provisions of Section ll15(f) of the Tax Law and Section 528.24 of the
Sales and Use Tax Regulations, Petitioner is required to pay sales tax on purchases of tangible
personal property regardless of whether the tangible personal property is for use in the practice of
veterinary medicine, for performing taxable services or designed for use in some manner relating to
domestic animals or poultry.
Subsequent sales by Petitioner of tangible personal property such as collars, flea spray,
brushes, food and medicine which are directly related to the well-being of animals and pets are not
subject to sales tax.
Because Petitioner provides taxable grooming services, Petitioner is required to be registered
as a sales tax vendor and collect sales tax on the receipts from the grooming services. However, even
though Petitioner must be registered as a sales tax vendor, Petitioner's purchases and sales of tangible
personal property still fall under the provisions of Section 1115(f) of the Tax Law and Section
528.24 of the Sales and Use Tax Regulations which require that Petitioner pay sales tax on certain
purchases of tangible personal property, but not collect sales tax on subsequent sales of such property
to customers.

DATED: July 30, 1992

/s/
PAUL B. COBURN
Deputy Director
Taxpayer Services Division

NOTE: The opinions expressed in Advisory Opinions
are limited to the facts set forth therein.