Written by Erin Delehanty.
Did you know that while the University is exempt from paying sales tax on most purchases, the associated entities are not?
Under current NC law, charitable nonprofits are required to pay sales and use tax on their purchases and can apply for a semi-annual refund of the taxes paid. What does this mean for you?
If you are making purchases that will be paid through University AP or on your PCard, you should follow the university process. No sales tax should be paid or invoiced with few exceptions like prepared food and beverages or occupancy tax.
If you plan on submitting invoices to be paid through the Foundations Accounting and Investments payment request process, you will need to make sure that the appropriate sales tax has been included on the invoice. FAI will pay the tax and charge it to a separate project that is monitored throughout the year. Twice a year, we will apply for a refund from the NC Department of Revenue. This process ensures that your project balances are not impacted by the sales tax that will eventually be refunded and also that we remain in compliance with NC Law.
For more information on sales tax, please contact Davan Wattley.