Is a security guard service — hiring a guard from a security company to walk a business's premises at night — subject to Texas sales tax?

Plain-English summary

A business asked whether it was correct that its security company charged sales tax on top of its hourly rate for a guard who walks the business's premises at night. The Comptroller confirmed: charges for providing security service to property or persons located in Texas are subject to Texas sales tax, so the security company was right to charge sales tax on the guard-service charge. The letter points to Comptroller's Rule 3.333 for the general rules on taxability of security services.

Note: the STAR system's own subject-matter index heading for this letter is broader ("Security Guards — Employed To Protect Buildings/Stadium/Employees"), reflecting a general taxonomy category rather than this specific letter's facts — the actual letter addresses only a straightforward premises-walking guard service for one business.

What this means for you

Businesses that hire security guard services

Expect your security provider's hourly guard charges to carry Texas sales tax — security services (guarding buildings, property, or persons located in Texas) are a taxable service category, not exempt labor.

Security companies

You're required to charge sales tax on your guard-service charges to customers, consistent with Rule 3.333.

Accountants and tax professionals

A short, general confirmation letter — useful as a citable baseline that security-guard services fall within the taxable "security services" category under Rule 3.333, without any fact pattern nuance (no discussion here of stadium security, event security, or armored transport, despite what the ruling's generic STAR subject heading might suggest).

Common questions

Q: Is a security guard service taxable in Texas?
A: Yes. Charges for security services to property or persons located in Texas are subject to Texas sales tax.

Q: Does it matter if the guard just walks the premises rather than actively responding to incidents?
A: No — this letter confirms tax applies to a guard hired simply to walk the premises at night.

Q: Can I rely on this letter for my own business?
A: No. This opinion is based on the facts presented, and different though similar facts could produce a different response; it can be relied on only by the taxpayer it was issued to.

Citations and references

Rules:

• 34 Tex. Admin. Code Rule 3.333 (taxability of security services)

Source

• STAR search: https://star.comptroller.texas.gov/search?doc_type_code=L&tax_type_code=SST
• Opinion: https://star.comptroller.texas.gov/view/200002082L

Original ruling text

February 29, 2000

Dear **:

Thank you for your inquiry concerning the taxability of security services. You
state that your company hires a security guard to walk the premises at night.
You also state that the security company an hourly rate for the guard plus
sales tax. You ask if this is taxable.

Charges for providing security service to property or persons located in Texas
are subject to Texas sales tax. The security company is correct in charging
you sales tax on the charge for the guard service. You may wish to read
Comptroller's Rule 3.333 concerning security services. Comptroller's Rules are
available at . At Quick Links, choose The Sales Tax.
Then select Sales Tax Rules and Statutes. Go to Current Tax Rules at the Texas
Secretary of State. A click on State Sales Tax will bring up the list of state
sales tax rules.

This opinion is based on the facts presented. Different though similar facts
could produce a different response. If you have additional questions or need
more information, you may call me at 1-800-531-5441, extension 3-4634. My
regular Austin number is 512/463-4634, and my fax number is 512/475-0900.
Written correspondence may be addressed to Tax Policy Division, Capitol
Station, Austin, TX 78774, or sent to .

Yours very truly,

Elizabeth Grieder
Tax Policy Division