BUSINESS TIP –––––––––––––––––––––––––––––––––––––––––––––––––––––– Mapeguard UM is a light- weight, waterproofing and vapor pressure-equalizing underlay- ment membrane from MAPEI. It provides crack suppression for use under ceramic tile and stone installations, for both residential and commercial applications. Mapeguard UM is designed to perform over challenging s u b s t ra t e s , such as young concrete and single-layer 3/4” (19 mm) plywood sub- floors with joist spac- ing of up to 19.2” (49 cm) on center. The unique engineered tri-layered design of Mapeguard UM absorbs lateral stress from the substrate without transferring this force to the tile or stone, which maintains excep- tional bonds. www.mapei.com. Sales tax on repair work Generally, for any repair work or replacement of existing tile, contrac- tors should now be charging – and paying to the state – sales tax on the total invoice amount (both material and labor). The sales tax is based on the rate for the county where the work is done. Most installers will want to become “tax exempt” for their purchases so that some material tax will be paid in as “use tax” and some as “sales tax.” It has been explained that those who work exclusively for general contractors will usually be exempt from the new tax on labor IF the tile installer gets the general con- tractor to complete the “blanket use” portion of the new tax form. Repairs or replacements in which the tile contractor is including the work of other trade specialists (i.e. a plumber & glass door company) are not so clearly delineated as to whether they are “repairs” or “capi- tal improvements” under the legisla- tion’s definitions. I went to a forum in which even the head of the N.C. Sales and Use Tax Division said he was still trying to figure out how to answer many of the construction industry’s questions. For now, contractors should be sure to speak with their local tax advisor, set up a system for tracking county tax rates, and charge sales tax on their work when required. The link to the N.C. Department of Revenue’s March notice can be found at www. DORNC.com/taxes/sales/realproper- tycontractors 32 TileLetter | May 2017