Fillable Form Ppt-6-A - Direct Payment Certificate (Page 2 of 2) in pdf

INSTRUCTIONS FOR USE OF DIRECT PAYMENT CERTIFICATE

GENERAL INFORMATION

A Direct Payment Permit, Form PPT-6, is evidence that the buyer designated thereon is authorized to issue a Direct

Payment Certificate, Form PPT-6A, in certain cases, in lieu of payment of the Petroleum Products Gross Receipts Tax at the

time of purchase, and subsequently to file reports and remit the tax directly to the Director.

When the purchaser who has issued the Direct Payment Certificate in turn makes a sale of petroleum products

delivered to a location in New Jersey and sells to a buyer which is not a distributor or the holder of a Direct Payment Permit,

the consideration from such sale results in gross receipts subject to tax unless the sale otherwise qualified for exemption,

exclusion, or deduction. Such seller must report and remit the tax to the Director.

Good Faith – In general, a seller who accepts an exemption certificate in “good faith” is relieved of liability for

payment of tax upon transactions covered by the certificate. The question of “good faith” is one of fact and depends

upon a consideration of all the conditions surrounding the transaction. A vendor is presumed to be familiar with the

law and the regulations pertinent to the business in which he deals.

In order for “good faith” to be established, the following conditions must be met:

(a) The certificate must contain no statement or entry which the seller knows, or has reason to know, is false or

misleading.

(b) The certificate must be an officially promulgated certificate form or a substantial and proper reproduction thereof.

and regular in every respect.

The seller may, therefore, accept this “good faith” Direct Payment Certificate as a basis for exempting sales to the

signatory purchaser provided that:

(d) The purchaser’s Employer Identification Number, indicating that the purchaser is registered with the New Jersey

Division of Taxation, is entered on the face of the Certificate as reflected on the Petroleum Products Gross

Receipts Tax Certificate of Authority.

(e) The purchaser has entered all other information required on the form.

(f) A copy of the purchaser’s Direct Payment Permit is attached to the form.

(g) The seller has no reason to believe that the petroleum product to be purchased is of a type not ordinarily used in

the purchaser’s business for the purpose described in this certificate.

Improper Certificate – Transactions which are not supported by properly executed direct payment certificates shall

be deemed to result in taxable gross receipts to the seller. The burden of proof that the consideration received may

be deducted from gross receipts and that the tax was not required to be paid is upon the seller.

Correction of Certificate – In general, sellers have 60 days after date of sale to obtain a corrected certificate where

the original certificate lacked material information to be set forth in said certificate or where such information is

incorrectly stated.

Documentation of Sale – Records shall be maintained identifying all sales to the customer issuing the certificate and

attributable to the certificate. Such records shall include date of sale, price, location of the transfer of the product,

quantity of product, and type of product sold.

Additional Purchases by Same Purchaser – This Certificate will serve to cover additional purchases by the same

purchaser of the same product. However, each subsequent sales slip or purchase invoice based on this Certificate

must show the purchaser’s name, address, and Direct Payment Permit number for the purposes of verification.

Retention of Certificates – Certificates must be retained by the seller for a period of not less than five years from the

date of the last sale covered by the certificate. Certificates must be in the physical possession of the seller and

day following the date of the transaction to which the certificate relates.

available for inspection on or before the 60

Restrictions – A Direct Payment Certificate may be issued, (and subsequently accepted by a seller), only by the

holder of a valid Direct Payment Permit.

Form Ppt-6-A - Direct Payment Certificate Page 2

Related Articles

Related forms

Related Categories