May 2, 2018
Re: § 58.1-1821 Application: Retail Sales and Use Tax
Dear *****:
This will reply to your letter in which you appeal the denial of certain retail sales and use tax refund claims submitted to the Department by ***** (the “Taxpayer”). I apologize for the delay in responding to your appeal.
FACTS
The 2013 Virginia General Assembly passed House Bill 2313 (Acts of Assembly 2013, Chapter 766), which increased the statewide retail sales and use tax rate. The legislation contained transitional provisions that allowed taxpayers that entered into certain contracts and leases before April 3, 2013 to request refunds of the resulting additional sales and use taxes paid on tangible personal property purchased or leased subsequent to the rate increase.
Pursuant to the transitional provisions of House Bill 2313, the Taxpayer applied for refunds of the additional taxes paid on the purchase of tangible personal property for two construction jobs, #570 and #576. The refund claims were subsequently denied by the Department based on a review of the contracts and supplemental information submitted by the Taxpayer.
DETERMINATION
Virginia Code § 58.1-1821 states:
Any person assessed with any tax administered by the Department of Taxation may, within ninety days from the date of such assessment, apply for relief to the Tax Commissioner. Such application shall be in the form prescribed by the Department and shall fully set forth the grounds upon which the taxpayer relies and all facts relevant to the taxpayer's contention.
Under Virginia Code § 58.1-1821 and Title 23 of the Virginia Administrative Code (VAC) 10-20-165, a complete appeal must be filed with the Department within 90 days from the date of an assessment. Title 23 VAC 10-20-165 A provides that the denial of a refund claim is deemed to be an assessment and a taxpayer may file an administrative appeal in response to the denial of a refund claim. For purposes of filing an administrative appeal in response to the denial of a refund, the issue date of the Department's correspondence that denies a taxpayer's refund claim is the date of assessment.
In this case, the Department issued the Taxpayer a letter dated March 22, 2016 that denied the Taxpayer's refund claims. Thus, March 22, 2016 is the assessment date. Based on the provisions of Virginia Code § 58.1-1821, the Taxpayer was required to file an administrative appeal by June 20, 2016, which is 90 days from the date of assessment. The Taxpayer filed the appeal by certified mail with a postmark of July 6, 2016. Pursuant to Virginia Code § 58.1-1821, the Taxpayer's appeal application is barred by the statute of limitations. Accordingly, there is no basis to consider the Taxpayer's appeal of the Department's denial of its refund claims.
The Code of Virginia section and regulation cited, along with other reference documents, are available on-line at www.tax.virginia.gov in the Laws, Rules and Decisions section of the Department's web site. If you have any questions concerning this response, please contact ***** in the Department's Office of Tax Policy, Appeals and Rulings, at *****.
Sincerely,
Craig M. Burns
Tax Commissioner
AR/748.S