Form Pub. Ks-1560 - Kansas Business Taxes For Schools & Educational Institutions Page 24
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37• spend more time on school business and less
exempt only after receiving the merchandise. As a buyer
time on government reports and filings.
who is exempt on most of its purchases, schools should
be proactive in furnishing a completed exemption
certificate to its vendors and service providers.
Retailers must “keep records and books of all such
sales, together with invoices, bills of lading, sales
All retailers should obtain a copy of Pub. KS-1520,
records, copies of bills of sale and other pertinent
Kansas Exemption Certificates, from our web site. This
papers and documents...” (K.S.A. 79-3609). The
publication provides detailed information about how to
requirements for electronic and paper format and
properly use exemption certificates as a buyer and as
content are prescribed by K.A.R. 92-19-4b. Your sales
a seller, and contains all the exemption certificates
tax records must contain the following documents and
currently in use.
information:
• Gross receipts from the sale, rental, or lease of
CAUTION: Do not accept a copy of a
tangible personal property in the state of Kansas,
customer’s sales tax registration certificate
including any services that are a part of the sale
instead of an exemption certificate. The
or lease, regardless of whether the receipts are
registration certificate shows the buyer is a retailer—it
considered to be taxable or non-taxable;
does not certify the purchase is exempt from tax.
• all deductions allowed by law and claimed in
your tax filings;
Completing an Exemption Certificate
• the purchase price of all tangible personal
property purchased for sale, consumption, or
Follow these three rules when completing any
lease in the state of Kansas (the cost of your
exemption certificate.
inventory, equipment, and fixtures);
1) P
,
.
• all exemption certificates; and
RINT OR TYPE ALL INFORMATION
EXCEPT FOR THE SIGNATURE
• a true and complete inventory taken at least
The information on the certificate must be legible
once a year.
both to you and to our auditors. Do not print a
signature on paper forms, although it is
You must keep these records for the current year
recommended that the name be printed or typed
and at least three prior years. Your sales tax records
below the signature. (A signature is not required on
must also be available for, and are subject to, inspection
an electronic exemption certificate.)
by the Director of Taxation or authorized representative
(auditor) at all times during normal business hours.
2) F
.
ILL IN ALL THE BLANKS
A certificate is complete only when all the information
EXEMPTION CERTIFICATES
is provided, including any tax account numbers
required by that certificate. If there is a blank on the
The burden of proving that a sale is not subject to
form, it must be completed. Addresses must include
tax is on the seller, unless the seller takes an exemption
the street or PO Box, city, state, and zip code.
certificate from the buyer that details why the sale is
not subject to tax. An exemption certificate is an
3) G
.
IVE SPECIFIC DESCRIPTIONS
electronic or paper document that is furnished or
Be precise when describing the property or services
completed by the buyer, and kept by the seller to show
purchased. You may use an itemized list, refer to an
why sales tax was not charged on an otherwise taxable
itemized invoice, or at the very least provide a general
sale of goods or services. Do not send completed
description of the items.
exemption certificates to KDOR - they must be kept as
a part of the seller’s sales tax records.
Penalties for Misuse
An accurately completed exemption certificate
A buyer who issues an exemption certificate in order
relieves the seller from collecting sales tax when the
to unlawfully avoid payment of the sales tax for business
seller has obtained the certificate and kept a copy on
or personal gain is guilty of a misdemeanor, and upon
file. Any person selling tangible personal property or
furnishing taxable services cannot assert that a sale is
conviction may be fined up to $1,000 or imprisoned for
exempt from taxation unless a properly executed
up to a year, or both. When a buyer is found to have
exemption certificate provided by the consumer claiming
used a resale exemption certificate to avoid payment
the exemption is a part of the seller’s sales or use tax
of the tax, the director may also increase any penalty
records. A retailer is responsible for obtaining a
due on the tax by $250 or 10 times the tax due,
completed exemption certificate even though the
whichever is greater, for each transaction where the
purchaser may strike the tax from the bill or claim to be
misuse of a resale exemption certificate occurred.
24
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