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Each tax reporting period, GL Accounting will take the balance in Sales Tax Payable and remit that cash to the taxing authority. For this reason, it is important that each JV submitted recording retail sales has an accurate and complete reflection of the Sales Tax Liability arising from these sales.

Use Tax

Use Tax applies where Sales Tax was not collected and remitted by the seller, usually due to jurisdiction of purchase and use. Where Sales Tax is collected and remitted by the seller for sales to customers within the state, Use Tax applies to buyers of goods as end customers where the use of the goods will take place in a different jurisdiction, often the state, from where it was purchased.

Use Tax is less common than Sales Tax, but in the event the University purchases a good that will not be sold on as a reseller, and Washington state Sales Tax is not collected by the seller, the University is responsible for tracking the Use Tax liability and remitting cash to the Washington Department of Revenue.

Your role in this process is to report appropriate Use Tax Liability. This should be reported in JVs prepared to record the purchase of goods from different jurisdictions according to the published rate (10.35% effective 4/1/2024). This process is similar to Sales Tax, but with Use Tax, the burden for reporting and remittance to the state is on the purchaserIf sales tax is not evident on purchases, the University is required to self-assess use tax.

Accounts Payable will make the use tax calculation and add the charge to the Purchase Order or Request for Payment.

If a purchase made via P-Card does not include sales tax, please contact payables@spu.edu so the University remains compliant with its tax obligations.