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California Sales and Use Tax Information
The university is not sales tax exempt. Therefore,the State Board of Equalization requires USC to pay California sales and use tax on all taxable transactions (i.e. tangible, non-edible items) that were purchased in or delivered to California.
For taxable purchases that were made with non-California merchants that did not charge sales tax, Payment Services will pay (accrue) Los Angeles sales tax (or accrue the tax rate for the applicable California county).
Use Tax on Procurement Cards
Effective November 2011, Payment Services reviews receipts associated with P-Card transactions made with non-California merchants to ensure that sales/use tax is properly accrued at point-of-sale. If it is deemed that sales/use tax was not paid, Payment Services will accrue the correct tax and charge it to the university account associated with the transaction. Departments are responsible for revieiwng P-Card sales tax accruals on their ASRs and immediately notifying Payment Services via email (firstname.lastname@example.org) of any incorrect accruals.
In 2012, Payment Services began automatic accrual of sales/use tax on unreconciled and undocumented transactions (i.e., no receipts attached to the eStatement transaction), after 35 days. Therefore, it is imperative that cardholders reconcile their P-Card eStatements within 21 days after eStatements are uploaded to Kuali Financial System (KFS), as per current P-Card policy.
Sales Tax on Invoices Received for Purchase Orders
Payment Services will automautomatically accrue Los Angeles County use tax on invoices for items shipped to California by non-California suppliers if use tax was applicable but not invoiced. An explanation to the non-California supplier will be provided when needed.
Note About Los Angeles Sales Tax
Los Angeles use tax is accrued, even if goods were delivered to Orange County, Sacramento, etc. However, if the supplier's initial invoice included a non-Los Angeles sales tax amount for a non-Los Angeles delivery, then the non-Los Angeles sales tax would be considered correct and would not be adjusted by Payment Services.