Accelerated Sales and Use Tax
Legislation passed by the General Assembly requires Retail Sales and Use Tax dealers who generated taxable sales and purchases of $48.5 million or more for the twelve-month period ending June 30, 2013 to make an accelerated payment. The payment must be made on or before June 25, 2014 for dealers paying by check, or June 30, 2014 for dealers making electronic payments. Affected dealers will be entitled to credit this amount against the amount due with their June return (due July 21, 2014).
- How will I know if I have to make an accelerated payment?
- My business has multiple locations, and each store files a separate return. The total sales generated for all locations were more than $48.5 million for the 12 months ended June 30, 2013, but no single location reported that much. Do I still have to make accelerated payments?
- What periods will be accelerated?
- Do accelerated payment requirements only apply to 2014?
- When is the payment due?
- Where do I send my payment?
- What is the accelerated payment amount?
- Will there be special forms for accelerated payment?
- I received more than one voucher for accelerated sales tax payment. Is this correct?
- I usually use iFile for reporting sales tax. Will I be able to use iFile for my accelerated payment, or will I have to use paper forms?
- I am a monthly filer of the Retail Sales and Use Tax and required to submit the return and payment electronically. Am I required to remit the accelerated sales tax payment electronically as well?
- Do I still have to file a June 2014 return?
- If my June 2014 sales are lower than my June 2013 sales, can I make a lower accelerated payment?
- I can't afford to make the accelerated payment. Who do I contact?
- Are there any penalties for failing to make an accelerated payment?
- What if the accelerated payment amount is underpaid? Will the penalty apply to just the underpayment, or to the entire accelerated amount due?
- What if I have additional questions?
The Virginia Department of Taxation will send notices to affected taxpayers. If you reported total taxable sales and purchases of $48.5 million or more for the twelve-month period ending June 30, 2013 and you do not receive a notice, you should contact us at (804) 367-8037.
My business has multiple locations, and each store files a separate return. The total sales generated for all locations were more than $48.5 million for the 12 months ended June 30, 2013, but no single location reported that much. Do I still have to make accelerated payments?
Yes. You will be required to make an accelerated payment for each location. We will issue separate notices for each of your accounts.
The accelerated payment requirement applies only to the month of June.
The law currently requires dealers who meet the accelerated payment requirement to make accelerated payments in June, 2014. This requirement may be phased out in subsequent years.
The June 2014 accelerated payment will be due on June 25, 2014 for dealers paying by mail and June 30, 2014 for dealers who pay electronically. For information on electronic payments, see the department's Online Services for Businesses page.
Where do I send my payment?
Virginia Department of Taxation
Post Office Box 26627
Richmond, Virginia 23260-6627
The amount due will be 90 percent of your tax liability (as reported or as assessed), less the applicable dealer's discount, for June 2013.
Yes. We will mail payment vouchers to affected dealers. The department will provide a reconciliation worksheet with instructions to help you determine the tax due with your return.
Yes. We will mail separate vouchers for each account that you have. However, the accelerated sales tax payments will not apply and you will not receive a voucher for accounts with a de minimis tax liability. For recordkeeping purposes, you should separately reconcile each payment using the applicable reconciliation worksheet. If you believe you have received a duplicate voucher in error, please contact us at (804) 367-8037.
You will be able to make your accelerated payment and file your June 2014 return electronically.
Yes. Beginning with the July 2012 return for monthly,and the July - September 2013 return for quarterly, filers of the Retail Sales and Use Tax must submit the return and payment electronically, unless a hardship waiver has been granted by the Tax Commissioner. Such dealers are also required to remit the accelerated sales tax payment electronically.
Yes. You will need to file your regular Retail Sales and Use Tax return showing your actual tax liability for June 2014 and remit the difference between your actual tax liability and your accelerated sales tax payment on or before July 21, 2014.
Your payment voucher will be preprinted with the amount due. If the accelerated payment creates an overpayment for June 2014, you will be able to claim a credit on your July return.
If the accelerated payment would cause an undue hardship, you may request in writing a waiver or partial waiver of the payment from the Tax Commissioner. You must clearly demonstrate the nature of the hardship with documentation and financial records. Examples of undue hardship include a substantial decline in sales since the previous June, or an out-of-state dealer that is no longer making sales in Virginia.
In general, if you can show an undue hardship, you will be allowed to make an accelerated sales tax payment equal to 90 percent of the your average monthly Retail Sales and Use Tax liability for the first quarter of the calendar year 2014. The Tax Commissioner will only waive the requirement for payment of the accelerated sales tax payment in extraordinary circumstances.
Applications for hardship waivers should be mailed to:
Virginia Department of Taxation
Post Office Box 5771
Richmond, Virginia 23220-0771
If you are required to make an accelerated payment and the payment is not made on time, a penalty of 6 percent of the tax due will be assessed. Interest will also be accrued on late payments. These charges are in addition to the normal penalties and interest that apply for late filing or late payment.
Example 1: Dealer A is required to make an accelerated payment of $10,000, but does not make the payment until July 10, 2014. The dealer will receive a one-time penalty assessment for $600 ($10,000 x 6%), plus applicable interest.
Example 2: Dealer A makes an accelerated payment of $10,000 on July 10, 2014, and receives a penalty assessment of $600. Dealer A then files a June 2014 reconciliation return, which shows additional tax due of $2,000, on July 31, 2014. Since the June reconciliation return was due to be filed by July 20, the dealer will receive a second assessment for the normal late filing penalty of $120 ($2,000 x 6%), plus applicable interest.
The penalty will apply only to the actual underpayment. For example, if the required accelerated payment amount is $10,000 and the dealer pays only $8,000 by the due date, the penalty will apply to the underpayment of $2,000.