Greenwood Village Tax Compliance Guide

Transcription

1 Greenwood Village Tax Compliance Guide The following information is intended to serve as a complement to the Greenwood Village Municipal Code and official tax policies as adopted by the Greenwood Village City Council. It is presented in layman s terms and not intended to be substituted for the full text of the Municipal Code. This guide does not constitute a City tax policy. Additional topics will be added as necessary. Suggestions for topics are welcome, please contact a member of Taxpayer Services at (303) or us at TaxDepartment@greenwoodvillage.com. Topic: Computer Software Software Maintenance Agreements Food for Home Consumption

2 Computer Software Computer software that is (1) leased or purchased at retail, (2) contained or can be contained on cards, tapes, discs, coding sheets, or other machine-readable or human-readable form, or (3) over which the buyer has any right, power, dominion, or control, is taxable as a tangible purchase or use, regardless of the means or mode of conveyance. Software that is downloaded from the internet, including new software and periodic charges for maintenance and support that are contained in machine-readable form on a tangible medium such as a taxpayer s computer, are subject to use tax, regardless of the means of conveyance or method of delivery. No distinction is made between canned or custom software. Only labor charges, separately stated by the software vendor are exempt from sales tax. Computer software is also taxable when the purchaser is granted a right to use the software such as with a license. Software used remotely via dial-in access, high speed network access, internal access or any other similar means is subject to tax, irrespective of the physical location of the computer software. Applicable Code Sections: Sec Definitions. For purposes of this Article, the following terms shall have the following meanings: Tangible personal property means property other than land or buildings, that can be seen, weighed, measured, felt, or stored on cards, tapes, discs, coding sheets, or other machine readable or human-readable form, or that can otherwise be consumed, used, or distributed, which is leased or purchased at retail over which the buyer has any right, power, dominion, or control, regardless of the means or mode of conveyance. Use tax means the tax paid or required to be paid by a consumer for using, storing, distributing, consuming or otherwise exercising, for any length of time any right, power, dominion, or control over tangible personal property or taxable services when leased or purchased at retail from any person inside or outside the city. Section Imposition of sales tax. (a) Levy. There is levied and there shall be collected and paid a sales tax on the full purchase price paid or charged for tangible personal property and taxable services sold at retail or leased by every person exercising a taxable privilege in the City by the sale or lease of such property and services. The sales tax is levied on all sales and leases of tangible personal property or taxable services except those specifically exempted, and is collected by the retailer or lessor and remitted to the City. (b) Taxable transactions and items. The sales tax shall apply as follows: (1) On the purchase price paid or charged for all sales and purchases of tangible personal property at retail. (2) On the total amount due under a lease or contract when the right to possession or use of tangible personal property is granted therein and such transfer of possession would be taxable under this Article if an outright sale were made.

3 Software Maintenance Agreements Software maintenance agreements that include the rights to future releases of computer software are taxable. Software maintenance agreements providing for additional user licenses are also taxable. Technical support that is a service only is not taxable. Software maintenance agreements for technical support are only exempt from sales tax when separately invoiced by the vendor. Applicable Code Sections: Section Imposition of sales tax. (a) Levy. There is levied and there shall be collected and paid a sales tax on the full purchase price paid or charged for tangible personal property and taxable services sold at retail or leased by every person exercising a taxable privilege in the City by the sale or lease of such property and services. The sales tax is levied on all sales and leases of tangible personal property or taxable services except those specifically exempted, and is collected by the retailer or lessor and remitted to the City.

4 Food for Home Consumption Items considered food for home consumption are defined by the Federal Supplemental Nutrition Assistance Program (SNAP), formally the Food Stamp Program under 7 U.S.C. Chapter 51, as amended. The City of Greenwood Village does not impose a sales tax on food for home consumption. The following items are considered tax exempt in the City of Greenwood Village: 1) Food purchased for human consumption at home, i.e. breads, cereal, fruits, vegetables, meats, fish, poultry, and dairy products. 2) Food purchased with food stamps or SNAP benefits. The following items are considered taxable in the City of Greenwood Village, unless paid for with food stamps or SNAP benefits: 1) Carbonated water marketed in containers. 2) Chewing gum. 3) Prepared salads and salad bar items. 4) Cold sandwiches. 5) Deli trays. 6) Soft drinks. 7) Candy. 8) Seeds and plants, which produce food for human consumption. The following items are considered taxable in the City of Greenwood Village, regardless of form of payment: 1) Non-food items, i.e. pet foods, paper products, household supplies, and personal grooming items. 2) Alcoholic beverages. 3) Food prepared for immediate consumption, this includes all hot foods or those that can be heated in the store. 4) Food preservation equipment and items. 5) Vitamins, dietary supplements and medicines. Prescription drugs are exempt. 6) Ice used for refrigeration. Sales and purchases of food and drinks sold through vending machines are exempt from Greenwood Village sales tax.

5 Applicable Code Sections: Section Definitions. Food for domestic home consumption means food and beverages purchased by a recipient of benefits under the Federal Supplemental Nutrition Assistance Program under 7 U.S.C. Chapter 51, as amended, except that food for domestic home consumption does not include carbonated water marketed in containers; ice; chewing gum; seeds and plants to grow food; prepared salads and salad bars items; hot or cold sandwiches; deli trays; soft drinks; candy; alcoholic beverages; food prepared for immediate consumption including all hot foods or those that can be heated in the store; and food or drink vended by or through machines or non-coin-operated coin-collecting food and snack devices on behalf of a vendor. Section (C). Exemptions. (15) The sale of food for domestic home consumption, as defined in this Article. (Prior code ; Ord. 32 1, 2011)