Collection on Sales

Although the university is exempt from paying sales tax on qualified goods and services it purchases for its educational operations, the university’s tax exempt status does not extend to sales it makes to other groups or individuals (i.e. students, employees, or other vendors). This is outlined in the Sales Tax Collection, Reporting and Remittance Policy. 

The following two paragraphs are specific to DC sales tax collection rules since a majority of the university’s activity takes place in DC. Sales or rentals in other states require the department to contact the Tax Department to understand the specific rules.

The university must collect sales tax on the sale or rental of tangible personal property, selected services and ticket sales for admissions to public events. Sales tax must also be collected from the rental of rooms to short-term rentals (or transients), parking sales and admissions to sporting events. Sales tax must be collected on copy and print sales (including those to students).

Activities that are generally not sales taxable include those services related to the university’s core educational mission, such as teaching, internships, research or related consulting agreements. Live performances such as concerts, opera and dance are not considered sales taxable. In addition, sales of meals to students are not considered sales taxable.

For any department that engages in the sale of taxable goods or services, the following procedure must be followed:

• Collect sales tax on taxable sales and rentals at the time of transaction
• Deposit collected taxes in the sale tax liability account (21281)
• Complete the Monthly Sales Tax Remittance Form using the instructions provided (both available on the University Accounting Services website) and send to University Accounting Services by the 10^th of each month for the taxable sales of the preceding month, even when no taxes are due
• Maintain complete records for sales of taxable goods and services for 7 years

Departments should not submit anything directly to a government taxing authority and should instead coordinate through University Accounting Services. The Tax Department will resolve any notices of letters received from a government taxing authority.

Process questions about reporting sales tax collection should be directed to University Accounting Services. Technical questions about what is sales taxable should be directed to the Tax Department.