Changed Rule will Reduce Utah State Sales Tax Payments

Rule R3-010A: Expenditure and Reimbursement Requirements has changed to reduce Utah Sales Tax payments made by the University.

Beginning February 1, 2015, Accounts Payable will treat reimbursement requests, which include Utah Sales Tax, in the following ways:

  • If Utah Sales Tax was paid as part of a recruitment or entertainment business meal for 10 individuals or less, the amount of tax paid will be considered an allowable expense and will be reimbursed to the requestor.

NOTE: PCards are considered the preferred method of payment for recruitment and entertainment business meals for 10 individuals or less. 

  • If Utah Sales Tax was paid as part of a business-related purchase (supplies or equipment, for example) the amount of tax paid will be considered unallowable and will not be reimbursed.

Exceptions: Academic Deans or equivalent positions in non-academic areas have the authority to approve an exception to pay Utah Sales Tax in extraordinary circumstances.

December 8, 2014:

Academic Deans or Directors in non-academic areas may approve, as required by Policy 3-031; (Recruitment and Entertainment Expenses), use of PCards for business meals on an individual cardholder basis.

  • New PCard applications will display a yes/no option for the business meal allowance as well as a signature line for Dean/Director approval.
  • Existing Cardholders that want to use their PCard for payment of business meals AND HAVE NOT FILED THE BUSINESS MEAL EXEMPTION FORM IN THE PAST, must send a memo (signed by Dean/Director) to Jane Scott in Purchasing to authorize the PCard for business meal use.

Monday, January 5, 2015:

Accounts Payable will reach out to departments that have paid Sales Tax to notify them of upcoming changes.

Monday, February 2, 2015:

Accounts Payable will reduce reimbursements by the amount of unauthorized Utah Sales Tax without notification to the requestor.

Sales Tax Reduction is part of our overall P2P Initiative to improve efficiencies and procurement savings across the University.

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8 Responses to Changed Rule will Reduce Utah State Sales Tax Payments

  1. Dalynn Berglund says:

    If a Business meal is for 11 or more individuals, how is the Utah Sales Tax handled?

  2. Kori Wetsel says:

    Utah Sales Tax should not be paid as part of a business meal for 11 or more. Accounts Payable, when processing reimbursement requests for 11+ person business meals will not reimburse the amount of Sales Tax paid. (Effective February 1, 2015). FBS is planning a post to clarify preferred methods of payment for Business Meals in the upcoming days.

    Thank you for the comment! We appreciate your question.

  3. Jillana AhLoe says:

    How does this rule change apply to petty cash reimbursements for business-related purchases? Should we reduce the cash reimbursement amount by the tax amount?

    • Kori DeHaan says:

      This Rule applies to Petty Cash Transactions as well as Reimbursements. Your department should avoid paying for Sales Tax when part of a petty cash transaction. If necessary, your Dean or equivalent can approve reimbursement of Sales Tax as part of the Payment Request to replenish the funds.

  4. Sue Parker says:

    How will reimbursements to volunteers and students be handled? Will the University reimburse them if they make a purchase?

  5. Tanis Garcia says:

    How it applies to Petty Cash: Per the notes handed out in the BPAG Meeting “Departments are responsible to ensure that petty cash expenditures do not include Utah Sales Tax. Petty Cash funds will not be replenished for amounts paid in Utah State Tax without the exception authorization from the cognizant Dean or equivalent position. ”

    Reimbursements to volunteers, students and other non-employees: Per the notes handed out in the BPAG Meeting “Departments are responsible to use preferred and direct methods of payment whenever possible. This may require departments to consider changes to their current procedures to comply. Departments are encouraged, in situations were an exception may be appropriate, to discuss their situation with central administrative officers. We are interested in assisting in every way possible to find a working solution to these changes.”

  6. Gail Howick says:

    Will taxes be paid on Utah hotel bills other than the Guest House?

  7. Gail Howick says:

    I have been waiting for a reply to my question of January 9, 2015. Will taxes be paid on Utah hotel bills, other than the University Guest House?

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