TSD-345 SALES TAX VENDOR RESPONSIBILITIES
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TSD-345
(Rev. March 2018)
SALES TAX AND VENDOR RESPONSIBILITIES
This publication describes state and municipal sales tax responsibilities arising from selling or leasing tangible personal
property or providing services in West Virginia. The rules discussed in this publication do not apply to sales of gasoline or
special fuels. This publication provides general information. It is not a substitute for tax laws or regulations.
GENERAL
INFORMATION
• If you sell or lease tangible personal property or provide a service in West Virginia, you are a vendor
required to collect sales tax on each sale, lease or service provided unless an exception applies. An
additional municipal tax may also apply. For a list of municipalities, effective dates and rates, visit our
website at:
https://tax.wv.gov/Business/SalesAndUseTax/Pages/SalesAndUseTax.aspx
➢ All sales, leases and services are presumed taxable. The burden of proof that a sale is exempt from
the tax rests with the vendor.
➢ You must collect sales tax regardless of whether you make sales as an individual, a partnership, a
corporation, a governmental agency other than a county in the normal course of local government
operations, or any other entity. Even non-profit organizations that are exempt from federal and state
income taxes must collect sales tax in many cases.
• As a vendor required to collect sales tax, you are a trustee of the State. You must keep accurate records
containing all the information needed to prepare your returns and to verify their accuracy.
➢ No one set of recordkeeping rules can apply to all vendors. Your records must be geared to your
operation and any recordkeeping equipment you use.
➢ If you fail to collect tax that should have been collected, you will be held personally liable for payment
of the tax.
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EXCEPTIONS TO
THE COLLECTION
REQUIREMENT
• There are only two exceptions to the requirement that vendors collect sales tax on each sale, lease or
service provided in West Virginia. You are not required to collect sales tax:
(1) If the sale, lease or service is a “per se” exemption; or
(2) If your customer provides a properly completed exemption certificate or direct pay permit applicable
to that transaction.
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“PER SE”
EXEMPTIONS
• The term “per se” means by, of, or in itself. When used in the context of sales tax exemptions it refers to
exemptions that do not require a special exemption document as proof of exempt status. Generally, the
normal documentation of the sale is sufficient proof of exemption.
• Even if you engage solely in transactions that are per se exempt from sales tax, you must keep sufficient
records to substantiate the exemption for each sale and service.
• Please refer to Publication TSD-300 for a more detailed discussion of per se exemptions and associated
recordkeeping considerations.
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EXEMPTION
DOCUMENTS
• If a transaction is not per se exempt, you are not required to collect sales tax if you obtain a properly
completed exemption document applicable to that transaction.
• There are a three types of exemption documents recognized in West Virginia:
➢ Tax exemption certificate,
➢ Direct pay permit, and
➢ Documents pertaining specifically to contractors
• Please refer to Publication TSD-300 for a more detailed discussion of exemption documents and
associated recordkeeping considerations.
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West Virginia State Tax
TSD-345 SALES TAX VENDOR RESPONSIBILITIES
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CUSTOMER
CANNOT OR DOES
NOT PRESENT AN
EXEMPTION
DOCUMENT AND
REFUSES TO PAY
SALES TAX?
• If the vendor notifies the Tax Commissioner in writing of such refusal by the customer, the vendor may be
relieved of any liability. The notification must include the name and, if known, address of the purchaser,
the purchase price of the item, and the amount of tax not collected.
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TAX COLLECTION
• As a rule, you must separately state the sales tax from the sales price or other consideration for a sale or
lease of tangible personal property or performance of a service.
• Typically, you should state the amount of tax on the invoice, receipt or billing document provided to your
customer.
• Similarly, sales tax should be separately stated on your documents of original entry (like receipts, invoices,
cash register tapes) and the supporting entries in your books of account.
• Sometimes vendors will include tax in the overall sales price of items like movie tickets or a hot dog at a
ball game. If a ticket or receipt is given to the customer, the ticket must either indicate the amount of tax
collected or include the phrase “West Virginia sales tax included in price” or a substantially similar phrase.
If a ticket or receipt is not given to the customer, a sign must be posted in plain view to customers that
includes the phrase “West Virginia sales tax included in price” or a substantially similar phrase.
• It is a crime for any vendor to represent directly or indirectly to the public that sales tax will be absorbed
by the vendor or that the tax is not added to the sales price.
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RECORDKEEPING
➢ You must maintain complete and accurate records relating to all sales and leases of tangible personal
property and services. These records must be:
➢ Maintained for three years or so long as the taxable period remains open to assessment or refund,
whichever is greater.
➢ Made available to the Tax Department for audit upon request.
➢ For all transactions, you should maintain:
➢ Documents of original entry (receipts, invoices, cash register tapes, etc.)
➢ Ledgers, journals or other books of account ordinarily maintained by the average prudent person
engaged in your business activities
➢ All schedules, working papers or other documents used in connection with the preparation of tax
returns (summaries, tabulations of invoices, cash register tapes, etc.)
➢ For exempt transactions, in addition to the above documents, you should maintain:
➢ Documents supporting per se exempt sales.
➢ Exemption documents received from customers
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BUSINESS
EXAMPLE
• The following scenario provides an example of sales transaction and recordkeeping
requirements.
Bob Jones owns and operates a general store in West Virginia. Over the years his
small store has grown to include a pharmacy, snack bar and video arcade. Bob
does his own bookkeeping, it helps him keep a handle on things. His accountant
comes in every quarter to check his work and prepare financial reports. This month
Bob is going to have to make some changes in the way he keeps his records. He
was recently audited by the State Tax Department and had just had a meeting with
the tax examiner and his accountant to go over the audit findings. The audit was
going to cost him a bundle and he is determined not to let that happen again. He
made a list of the things he needed to do.
➢ Grocery Department
Sales
1. Always collect sales tax on the gross amount of sales paid for with manufacturer’s
coupons. Only store coupons and promotions qualify as a discount.
TSD-345 SALES TAX VENDOR RESPONSIBILITIES
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2. Write a separate sales receipt for sales of cleaning supplies to city hall and the local
church and be sure to get a completed and current tax exemption certificate to keep
on file. A cash register receipt is not acceptable proof of a sale to an exempt
purchaser.
3. Balance “food stamp” sales with food stamp receipts. Clerks have been recording
certain non-food items which do not qualify as food stamp purchases and not
collecting the proper amount of sales tax. Train clerks.
4. Collect the five percent municipal wine tax on all sales of wine. This is in addition to
the six percent sales tax.
5. Establish separate accounts in daily sales journal for the above.
Purchases
1. Write to Ace Office Supply Company and tell them to charge sales tax on my
purchases because the old exemption certificate I gave them several years ago is not
valid.
2. Review all invoices from out-of-state suppliers. Pay use tax on all purchases if they
did not collect West Virginia sales tax (except purchases for resale).
3. Pay use tax on all paper and cleaning supplies taken off the store shelf for use in the
store, the pharmacy and the snack bar.
4. Pay use tax on groceries I took home for my own personal use.
5. Pay use tax on the turkeys I gave my employees for Thanksgiving.
➢ Pharmacy
Sales
1. Collect sales tax on all over the counter medications. Do not ring these up as "Rx".
2. Set up filing, accounting system for prescriptions to relate the prescriptions filled to
my “per se” exempt sales.
Purchases
1. Send exemption certificate to Professional Medical Supply Company for purchases
of medicine bottles used to fill prescriptions. These qualify as resale items.
2. Review invoices from all out-of-state suppliers. Pay use tax on all purchases if they
do not collect West Virginia sales tax (except for purchases for resale items).
➢ Snack Bar/Video Arcade
Sales
1. There is no cash register in the snack bar and all prices were even amounts.
(Hotdogs-75¢, Chips-50¢, Cokes- 50¢, etc.). Tax would have to be computed using
the formula given by the tax examiner. A sign would also need to be posted stating
that the sales tax was included in the price of the products sold.
2. The formula to compute the sales tax included in the price charged to play the video
games would have to be used. The commission paid to the clerk who made change
and supervised the game room could not be deducted.
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EXAMPLE OF SIGN
POSTING
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West Virginia Sales Tax is Included in
the Price of the Products Sold Here
TSD-345 SALES TAX VENDOR RESPONSIBILITIES
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ASSISTANCE AND
ADDITIONAL
INFORMATION
• For assistance or additional information, you may call a Taxpayer Service Representative at:
1-800-WVA-TAXS
(1-800-982-8297)
Or visit our website at:
www.tax.wv.gov
File and pay taxes online at:
www.mytaxes.gov
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