Tax Type
BPOL Tax
Local Taxes
Description
Determining definite place of business
Topic
Local Power to Tax
Date Issued
08-13-1999
August 13, 1999
Re: Request for Advisory Opinion
Business, Professional and Occupational License (BPOL) Tax
Dear *********************
This will respond to your letter requesting an advisory opinion as to the local license taxation of ***** (the "Taxpayer'). I apologize for the delay in responding to your request.
The local license fee and tax are imposed and administered by local officials. Section 58.1-3701 of the Code of Virginia authorizes the department to promulgate guidelines and issue advisory opinions on local license tax issues. Additionally, *****§ 58.1-3703.1(A)(5) authorizes the department to receive taxpayer appeals of certain local license tax assessments and to issue determinations on such appeals. However, in no case is the department required to interpret any local ordinance. Code of Virginia§ 58.1-3701. The following opinion has been made subject to the facts presented to the department as summarized below. Any change in these facts or the introduction of facts by another party may lead to a different result.
While addressing the questions raised in your letter, this response is intended to provide advisory guidance only, and does not constitute a formal or binding ruling. I have enclosed copies of cited material for your review.
FACTS
The Taxpayer states that its primary business involves the provision of money transfer and other financial services to consumers through a network of independent businesses (such as grocery stores, convenience stores and drug stores) located throughout the United States and worldwide. These businesses sell the Taxpayer's services in much the same manner as they sell other products and services to their customers. The Taxpayer does not maintain a separate office at these locations, nor does it staff these locations with its own employees. All of the Taxpayer's services are offered and performed by the independent businesses and their employees.
The Taxpayer asserts that it is not subject to license taxation in your locality (the "City'), as it has no offices or employees within the City. You seek guidance as to the license taxation of the Taxpayer.
OPINION
Subject to limits set forth in Code of Virginia§ 58.1-3703(C), localities may charge a fee for issuing BPOL licenses or may levy a license tax on a business for the privilege of engaging in business at a definite place within the locality. Code of Virginia§§58.1-3700 and 58.1-3703(A). Business means "a course of dealing which requires the time, attention and labor of the person so engaged for the purpose of earning a livelihood or profit. It implies a continuous and regular course of dealing, rather than an irregular or isolated transaction.' Code of Virginia§ 58.1-3700.1. A definite place of business means "an office or a location at which occurs a regular and continuous course of dealing where one holds one's self out or avails one's self to the public for thirty consecutive days or more, exclusive of holidays and weekends.' 1997 BPOL Guidelines§1.
The determination of whether or not a business has a definite place of business in a locality is dependent on the facts and circumstances of each case. Factors indicating that an entity has a definite place of business in a locality may include the maintenance of a business phone, a phone directory listing, a mailing address, facilities for meeting with customers and retention of business records at a place in the locality. See P.D. 97-201.
The Taxpayer does not have an office, employees, a business phone, a phone directory listing, a mailing address nor facilities for meeting with customers or retention of business records in the City. Accordingly, it is my opinion that the Taxpayer does not maintain a definite place of business in the City and is not subject to license taxation in the City.
I hope that the above information will be beneficial to you. Although I believe this letter conforms with the requirements of the law, it is written only for your guidance. If you have other questions, please do not hesitate to contact ***** Tax Policy Analyst, in my Office of Tax Policy at ****
Sincerely,
Danny M. Payne
Tax Commissioner
OTP22805D
Re: Request for Advisory Opinion
Business, Professional and Occupational License (BPOL) Tax
Dear *********************
This will respond to your letter requesting an advisory opinion as to the local license taxation of ***** (the "Taxpayer'). I apologize for the delay in responding to your request.
The local license fee and tax are imposed and administered by local officials. Section 58.1-3701 of the Code of Virginia authorizes the department to promulgate guidelines and issue advisory opinions on local license tax issues. Additionally, *****§ 58.1-3703.1(A)(5) authorizes the department to receive taxpayer appeals of certain local license tax assessments and to issue determinations on such appeals. However, in no case is the department required to interpret any local ordinance. Code of Virginia§ 58.1-3701. The following opinion has been made subject to the facts presented to the department as summarized below. Any change in these facts or the introduction of facts by another party may lead to a different result.
While addressing the questions raised in your letter, this response is intended to provide advisory guidance only, and does not constitute a formal or binding ruling. I have enclosed copies of cited material for your review.
FACTS
The Taxpayer states that its primary business involves the provision of money transfer and other financial services to consumers through a network of independent businesses (such as grocery stores, convenience stores and drug stores) located throughout the United States and worldwide. These businesses sell the Taxpayer's services in much the same manner as they sell other products and services to their customers. The Taxpayer does not maintain a separate office at these locations, nor does it staff these locations with its own employees. All of the Taxpayer's services are offered and performed by the independent businesses and their employees.
The Taxpayer asserts that it is not subject to license taxation in your locality (the "City'), as it has no offices or employees within the City. You seek guidance as to the license taxation of the Taxpayer.
OPINION
Subject to limits set forth in Code of Virginia§ 58.1-3703(C), localities may charge a fee for issuing BPOL licenses or may levy a license tax on a business for the privilege of engaging in business at a definite place within the locality. Code of Virginia§§58.1-3700 and 58.1-3703(A). Business means "a course of dealing which requires the time, attention and labor of the person so engaged for the purpose of earning a livelihood or profit. It implies a continuous and regular course of dealing, rather than an irregular or isolated transaction.' Code of Virginia§ 58.1-3700.1. A definite place of business means "an office or a location at which occurs a regular and continuous course of dealing where one holds one's self out or avails one's self to the public for thirty consecutive days or more, exclusive of holidays and weekends.' 1997 BPOL Guidelines§1.
The determination of whether or not a business has a definite place of business in a locality is dependent on the facts and circumstances of each case. Factors indicating that an entity has a definite place of business in a locality may include the maintenance of a business phone, a phone directory listing, a mailing address, facilities for meeting with customers and retention of business records at a place in the locality. See P.D. 97-201.
The Taxpayer does not have an office, employees, a business phone, a phone directory listing, a mailing address nor facilities for meeting with customers or retention of business records in the City. Accordingly, it is my opinion that the Taxpayer does not maintain a definite place of business in the City and is not subject to license taxation in the City.
I hope that the above information will be beneficial to you. Although I believe this letter conforms with the requirements of the law, it is written only for your guidance. If you have other questions, please do not hesitate to contact ***** Tax Policy Analyst, in my Office of Tax Policy at ****
Sincerely,
Danny M. Payne
Tax Commissioner
OTP22805D
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Rulings of the Tax Commissioner