SALT Report 1403 – The West Virginia State Tax Department has updated their sales and use tax publication regarding direct pay permits and record-keeping requirements. The Publication provides general information for vendors that sell or lease tangible personal property or provide services in West Virginia.
Direct Pay Permits
A direct pay permit number is not a tax exempt number and must be accepted in good faith. To protect yourself, you should obtain and retain a copy of the direct pay permit issued to your customer by the Department. Direct pay permit numbers have changed for the past three years. Each invoice for the customer must clearly reflect the direct pay permit number in effect at the time of the purchase. As of January 2012, direct pay permits can no longer be used for food purchases.
Record Keeping Requirements
You must maintain complete and accurate records relating to all sales and leases of tangible personal property and services. The burden of proving that a particular sale, lease or service was exempt from tax and that tax was not required to be collected lies with you. Accordingly, if you have transactions that are per se exempt or if you receive exemption documents from your customers and do not collect tax for a certain transaction, you must keep records that list separately the gross sales, leases and services. All sales records must be made available to the Department upon request for audit.
If you did not collect sales tax because of an exception requirement you must follow certain record keeping rules. Your records must consist of the normal books of account ordinarily maintained by a person engaged in a similar business and include bills, receipts, invoices, cash register tapes or other original documents supporting entries in your books of account.
Furthermore, all schedules or working papers used to prepare tax returns must be maintained. These schedules should include summaries and tabulations of invoices or cash register tapes or any other original documents that were used to calculate the reported figures. All of these records must be maintained for three years or as long as the taxable period remains open to assessment or refund, whichever is greater.
The rules discussed in this Publication do not apply to sales of gasoline or special fuels.
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