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Business Taxes Law Guide—Revision 2024
Sales and Use Tax Annotations
A B C D E F G H I J L M N O P R S T U V W X
S
495.0000 Sale
Annotation 495.0847
(e) Retail Sale or Sale for Resale—Delivery by Owner, Former Owner, Factor or Agent
495.0847 Delivery to In-State Processor. A taxpayer sells products to a buyer who is not located or registered in California. At the buyer's request, taxpayer ships the product from its out-of-state plant or from its California plant to a company in California, which will perform further processing of the product for the buyer. The processor subsequently ships the processed product to the buyer's customer. The buyer's customer may be the end user or it may resell the product. The buyer's customer may be located in California or it may be located out of this state.
In all variations, the buyer is purchasing taxpayer's products for resale. Taxpayer has no tax liability unless the second paragraph of section 6007 applies. If the taxpayer documents the fact that it shipped the product to a California processor on behalf of the buyer, the taxpayer is not subject any tax liability. The processor, however, may have liability under the second paragraph of section 6007. 9/15/94. (Am. 2011)