for Auto Shops
Many auto repair shop owners make one small mistake that can lead to tax issues, rejected loan applications, or even trouble with insurance. That mistake is using the wrong NAICS code.
The right NAICS code helps your chances of getting funding and prevents confusion during audits. Read below to get information on how to choose the right NAICS code.
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What is an NAICS code?
NAICS is short for North American Industry Classification System. A system that is used by the U.S. government to categorize all different types of businesses according to what they do.
Each enterprise is coded with a six-digit number to describe its main activity. The first 2 digits represent the overall sector. The subsector is indicated by the next 3rd digit. The 4th digit indicates the industry group. Between groups, more details in which group is the 5th digit. The 6th digit is the most specialized and may vary from country to country.
For instance, an auto repair shop would be under 811198. 81 is for other services, 811 for repair and maintenance. 8111 for automotive repair and maintenance. 81119 for other automotive repair and maintenance. 811198 for all other automotive repair and maintenance.
These codes are revised by the NAICS system every five years. The last update was in 2022, and the next one will come in 2027.
Choosing the right NAICS code: Why accuracy matters?
The NAICS code for your auto repair shop helps define your business in official records. It’s important to:
1. File taxes correctly
Different types of businesses will have different tax breaks or other reporting requirements. If you are not using the proper NAICS code, this can raise a red flag for the IRS or cause problems if your tax return ever comes under audit.
2. Request for business loans or grants
Most governments and private programs have a specified area of funding or tax advantages targeted at different industries.
3. Work with vendors, insurers, and government contracts
Some insurance companies use NAICS codes to assess risk and set premiums. Using the right one can save you money or avoid delays in getting coverage. The same goes for parts suppliers or vendor databases.
4. Get better marketing data and reports
Coding accurately helps you compare yourself to others in your industry. If your shop is grouped with unrelated industries, you might get bad data on pricing, revenue or employee count.
Also, know where your shop fits in the bigger automotive industry. When you know your NAICS code, you can compare data, track trends, and run your shop successfully.
If you’re still not sure, narrow it down to what services make up most of your work. Then look for a NAICS code that matches your main income source.
Which NAICS code should I use for auto repair?
Well, it depends on your automotive work and the specialization you offer to serve.
If your shop doesn’t focus on major engine or body work but handles a mix of services, then 811198 is likely the right choice. As per the North American Classification System,
“NAICS Code 811198 comprises establishments primarily engaged in providing automotive repair and maintenance services (except mechanical and electrical repair and maintenance; body, paint, interior, and glass repair; motor oil change and lubrication; and car washing) for automotive vehicles, such as passenger cars, trucks, and vans, and all trailers.”
Below is a split of the most commonly used NAICS codes for automotive services and what they are, so you can effortlessly locate the proper code.
NAICS Code | Automotive Service | Description |
811111 | General Automotive Repair | For shops that handle all-around repairs like engines, transmissions, electrical, etc. |
811114 | Specialized Automotive Repair | For shops focusing on specific systems. It can be one of these: brakes, exhaust, suspension, diesel. |
811121 | Automotive Body, Paint and Interior Repair | Body shops, collision repair and interior fixes |
811122 | Automotive Glass Replacement Shops | For windshield and glass repairs. |
811191 | Oil change and Lubrication | For shops focusing on oil changes and basic fluid services |
811198 | All Other Automotive Repair and Maintenance | Covers services like tire patching, A-/C repair, emissions, testing and undercoating. |
How do you apply for an NAICS code for an auto repair shop?
You don’t actually “apply” for a NAICS code in the traditional sense. The NAICS system is not something you register for. You assign the code to your business yourself when you register with government agencies, apply for licenses, or file taxes.
Here’s how it works:
1. Choose the right code based on your main services
Visit the official NAICS site and search for keywords like “auto repair,” “diesel,” or “oil change.”
Pick the code that best matches the primary service your shop offers. For example, 811111 for general auto repair.
2. Use the code when registering
You’ll need your NAICS code when:
- You apply for your shop’s business license
- File your business taxes
- Request for loans or grants
- Register with your state or local government
- Get D-U-N-S number or apply for federal contracts
3. Update the code if your services change
As your shop grows, or if your business shifts from offering mostly oil changes to primarily diesel engine work, then you will need to make sure that you change the NAICS code for whatever is now going on as a major business activity.
Wrapping up
It is important to double-check the NAICS code. It seems like a small detail but can impact different facets of your business.
Use AutoLeap to align your auto repair services and get clarity to choose the right NAICS code. Avoid discrepancies and have all compliance, tax, and funding issues sorted.
How do I know the NAICS code for an auto repair shop?
The auto repair shop code is 811111 or 811198.
Is there an NAICS code for diesel mechanics?
Diesel mechanics are listed under 811114. These mechanics focus on diesel engines or fuel systems.
Where can I find the full list of NAICS codes?
You can view the full list on the U.S. Census NAICS website (external link no-follow).
