Pol-Sales and Use Tax
policy sales use tax modified Thu Nov 10 2022 08:14:58 GMT-0500 (Eastern Standard Time)
University of Louisville
Sales and Use Tax
January 1, 2008
This policy applies to all University employees (administrators, faculty, and staff).
Tax on Applicable Purchases
The University of Louisville (University) is exempt from Kentucky sales and use tax on applicable purchases made by the University as long as the purchased items or services are used solely within the educational or charitable functions of the institution.
Presentation of the University’s Purchase Exemption Certificate to the vendor is required to make exempt purchases. Under Kentucky law, use of the University’s exempt status for the personal benefit of an employee or any other individual is punishable by fine and/or imprisonment.
Tax on Applicable Sales
The University must collect and remit sales tax as applicable under Kentucky law. The University is not exempt from collecting tax on applicable sales made by the University to customers. Note that under Kentucky law, the following sales are not taxable:
- Sales of food to students in school cafeterias or lunchrooms;
- Sales by school bookstores of textbooks, workbooks, and course materials.
All other sales of tangible property and certain services are considered taxable sales. This includes food sales to the general public, faculty, and staff. This also includes bookstore sales of items not considered course materials such as notebooks, paper, pencils, and similar student aids.
- When a department makes a sale identified as a taxable sale, it should collect tax at a rate of 6%.
- All collected sales tax should be deposited and recorded to GL account 214200.
- The revenue from a taxable sale should be recorded to GL account 424240.
- The Tax Department will prepare the sales tax return and remit any sales tax to the Kentucky Department of Revenue by the appropriate due date.
Department – Identification of taxable sales; collects tax; records tax in GL as per procedure outlined above.
Tax Department – Reports and remits tax to the Kentucky Department of Revenue by the appropriate due date; consults departments on sales tax matters.
Vice President for Finance and Chief Financial Officer
RESPONSIBLE UNIVERSITY DEPARTMENT/DIVISION
Louisville, KY 40292
Revision Date(s): May 16, 2016; July 1, 2018; June 10, 2019; January 29, 2020
Reviewed Date(s): May 16, 2016; July 1, 2018; June 10, 2019
The University Policy and Procedure Library is updated regularly. In order to ensure a printed copy of this document is current, please access it online at http://louisville.edu/policies.