Did you know that units are responsible for collecting and reporting applicable sales taxes when making a taxable sale to an external party?
Taxable sales are typically defined as sales of tangible personal property to an external party (including students/faculty/staff). These types of sales are primarily recorded in self-supporting funds.
However, taxable sales may also take place in other fund types as well, such as gift funds. In order to determine whether a taxable sale has taken place within a gift fund, consider the following:
- Sales of tangible personal property for fundraising purposes at a live, silent, or online auction are typically exempt from sales tax, thus there is no need to collect sales tax in these scenarios.
- However, sales of tangible personal property for fundraising purposes during non-auction fundraising events typically are subject to sales tax. Thus, sales tax would need to be collected and reported from these types of non-auction fundraising sales.
- These guidelines apply to items that were specifically purchased for resale at a fundraising event, as well as to items that were obtained via a gift-in-kind donation which are then sold as a part of a fundraising effort.
For further guidance related to collecting and reporting sales tax, refer to Collect and Report Sales and Use Tax and Section 18.6 Sales and Use Tax within the Business and Financial Policies and Procedures manual.
Contact
For further details, contact the applicable subject matter experts listed in the Sales Tax section of UAFR's Who to Ask list.
