Sales and Use Tax Guide - TN.gov

Sales and Use Tax

Manual

¡®

August 2022

1| P a g e

Contents

Chapter 1: Introduction .............................................................................................. 16

General Overview....................................................................................................................................... 16

1.

Administration............................................................................................................................... 16

2.

Transactions Subject to Sales & Use Taxes........................................................................... 16

3.

Rates and Impositions................................................................................................................. 17

4.

Credits.............................................................................................................................................. 18

5.

Exemptions..................................................................................................................................... 19

Chapter 2: Nexus........................................................................................................ 20

Historical Overview.................................................................................................................................... 20

Tennessee Nexus Requirements........................................................................................................... 21

1.

Out-of-State Dealers with no Physical Presence in Tennessee ...................................... 22

2.

Local Sales Tax Reporting by Out-of-State Dealers ............................................................ 22

Chapter 3: Administrative Requirements ................................................................... 24

Registration Generally .............................................................................................................................. 24

Registration Process.................................................................................................................................. 25

1.

Consumers or Business Users.................................................................................................. 25

2.

Flea Market Operators & Dealers............................................................................................ 26

3.

Revocation of Certificate of Registration............................................................................... 27

Filing and Payments .................................................................................................................................. 27

1.

Filing through TNTAP................................................................................................................... 27

2.

Filing through an Approved Software Vendor ..................................................................... 28

3.

Filing through the Streamlined Central Registration System.......................................... 28

Filing Periods and Due Dates.................................................................................................................. 28

1.

Filing Periods.................................................................................................................................. 28

2.

Filing and Payment Due Dates.................................................................................................. 29

2| P a g e

1099-K Filing Requirement ...................................................................................................................... 29

Rules for Billing Sales Tax ........................................................................................................................ 30

1.

Invoicing .......................................................................................................................................... 30

2.

Installment or Credit Sales......................................................................................................... 31

Refunds ......................................................................................................................................................... 31

1.

Refund Requests Made by Dealers ......................................................................................... 31

2.

Refund Requests Made by Customers................................................................................... 31

Statutes of Limitations.............................................................................................................................. 33

1.

Assessments................................................................................................................................... 33

2.

Refunds............................................................................................................................................ 33

3.

Statute Waivers ............................................................................................................................. 34

Penalties........................................................................................................................................................ 34

1.

Penalties and Penalty Rates ...................................................................................................... 35

2.

Penalty Waivers............................................................................................................................. 35

Interest .......................................................................................................................................................... 38

Records Maintenance ............................................................................................................................... 38

1.

Records Requested ...................................................................................................................... 38

2.

Record Retention.......................................................................................................................... 40

3.

Failure to Retain Records ........................................................................................................... 40

Assessment and Informal Conferences............................................................................................... 40

Change in Business Ownership and Closing Your Business ......................................................... 41

Successor Liability ...................................................................................................................................... 42

Responsible Person Liability ................................................................................................................... 43

Chapter 4: Common Sales Tax Concepts ..................................................................... 46

Overview ....................................................................................................................................................... 46

Commonly Used Terms in Sales Tax Law ........................................................................................... 46

1.

Auctioneers, Agents, and Factors ............................................................................................ 46

2.

Business .......................................................................................................................................... 47

3| P a g e

3.

Commissioner................................................................................................................................ 47

4.

Dealer............................................................................................................................................... 47

5.

Leases and Rentals....................................................................................................................... 49

6.

Marketplace Facilitator ............................................................................................................... 54

7.

Person.............................................................................................................................................. 54

8.

Resale ............................................................................................................................................... 55

9.

Retail Sale........................................................................................................................................ 55

10. Retailer............................................................................................................................................. 55

11. Sale.................................................................................................................................................... 55

12. Sales Price ....................................................................................................................................... 57

13. Specified Digital Product ............................................................................................................ 57

14. Tangible Personal Property ....................................................................................................... 58

15. Use .................................................................................................................................................... 58

Chapter 5: Sales Tax Imposition on Services and Tangible Personal Property.............. 60

Taxable Services ......................................................................................................................................... 60

1.

Repair of Tangible Personal Property or Computer Software ........................................ 61

2.

Installation of Tangible Personal Property or Computer Software ............................... 63

3.

Lodging Services & Rooms......................................................................................................... 64

4.

Short-Term Space Rented by Dealers..................................................................................... 67

5.

Cleaning Tangible Personal Property ..................................................................................... 68

6.

Parking and Storage of Motor Vehicles.................................................................................. 72

7.

Telecommunications Services .................................................................................................. 73

8.

Ancillary Services .......................................................................................................................... 74

9.

Uranium Enrichment ................................................................................................................... 75

10. Television Programming Services............................................................................................ 75

Nontaxable Services in Connection with Real Property ................................................................. 75

Tangible Personal Property ..................................................................................................................... 76

1.

Coins, Currency, and Bullion..................................................................................................... 77

4| P a g e

Chapter 6: Use Tax ..................................................................................................... 78

Overview ....................................................................................................................................................... 78

1.

Definitions....................................................................................................................................... 78

2.

Use Tax Imposition....................................................................................................................... 79

Activities Subject to Use Tax ................................................................................................................... 79

1.

Specified Digital Products and Video Game Digital Products ......................................... 80

When Use Tax Does Not Apply............................................................................................................... 80

1.

Personal Items Moved into Tennessee.................................................................................. 81

2.

Import for Export .......................................................................................................................... 81

3.

Interstate Commerce - Title and Property Pass outside the State ................................ 82

4.

Storage of Tangible Personal Property .................................................................................. 82

5.

Tangible Personal Property Held for Resale......................................................................... 83

Contractor¡¯s Use Tax ................................................................................................................................. 83

1.

Contractor¡¯s Use Tax.................................................................................................................... 83

2.

Contractor-Dealers....................................................................................................................... 84

3.

Exemptions..................................................................................................................................... 84

4.

Tax on Fabricated Materials ...................................................................................................... 87

5.

Installation of Industrial Machinery ........................................................................................ 87

6.

Property Owned by the United States Government .......................................................... 88

7.

Qualified Disaster Restoration.................................................................................................. 88

Credit for Taxes Paid in another State................................................................................................. 90

Chapter 7: Local Sales Tax Imposition......................................................................... 91

Overview ....................................................................................................................................................... 91

Local Tax Limitations................................................................................................................................. 91

Local Option Tax Rates............................................................................................................................. 92

Local Sourcing Rules.................................................................................................................................. 92

1.

Sales at Special Events ................................................................................................................ 93

2.

Food Trucks.................................................................................................................................... 93

5| P a g e

 ................
................

In order to avoid copyright disputes, this page is only a partial summary.

Google Online Preview   Download