006.05.06 Ark. Code R. 005-GR-77

Current through Register Vol. 49, No. 10, October, 2024

Rule 006.05.06-005-GR-77 - REPORTS, RETURNS, AND REMITTANCES

A. MONTHLY REPORT.

1. The tax shall be due and payable on the first (1^st) day of every month by any person liable for the payment of any tax due.

2. It is the duty of all taxpayers (sellers) to deliver to the Director, on or before the twentieth (20th) day of each month, a return showing the tax due, during the preceding calendar month. Date of mailing of a return as reflected by the postmark of the U.S. Postal Service is deemed to be the date of delivery. The following information must also appear on the return:

a. The name and address of the business (if the name or address of the business has changed, the new name or address must be submitted to the Department along with the old name or address of the business);

b. The permit number of the business; and

c. The amount of tax due and payable with the return.

3. The appropriate amount of tax due and payable as reflected on the return must accompany the returns as required herein.

4. Although separate permits are required for each business location in Arkansas, every taxpayer shall file a single report combining all of the tax due derived from sales at its Arkansas locations that are registered with the Director under the same Federal Employer's Identification Number ("FEIN") or Social Security number. This provision applies regardless of whether the taxpayer is an individual, corporation, partnership, limited liability company, or other entity.

B. QUARTERLY REPORT. When the average amount of tax for which the taxpayer is liable for the previous fiscal year (July 1 through June 30) does not exceed $100.00 per month, the Director may notify the taxpayer that the taxpayer may file quarterly reports on or before July 20, October 20, January 20, and April 20. Taxpayers should continue to file monthly reports until they receive the notice to begin filing quarterly reports.

C. YEARLY REPORT. When the average amount of tax for which the taxpayer is liable for the previous fiscal year (July 1 through June 30) does not exceed $25.00 per month, the Director may notify the taxpayer that the taxpayer may file one yearly report on or before January 20 for the preceding twelve (12) month period. Taxpayers should not change their method of filing until they receive the notice to begin filing annually.

D. PREPAYMENT. Ark. Code Ann. § 26-52-512.

1. All taxpayers that have average net sales of $200,000.00 or more per month for a period of one (1) year must prepay their monthly gross receipts tax liability by electronic funds transfer. (See GR-77(E) and GR-77(F).) The Department's Sales and Use Tax Section will review a taxpayer's reported taxable sales for each month beginning in July and ending with the following June to determine if a taxpayer must make prepayments. This review is performed once each year by the Department.

2. The prepayment program applies only to those sales that are subject to gross receipts tax. Any sales that the taxpayer reports that are subject to compensating use tax or any other type of excise tax are not taken into account when determining if the taxpayer must make prepayments.

3. Two (2) methods of making the electronic funds transfer prepayments are available to the taxpayer each month. The taxpayer is free to choose one method or the other for any period of time. The taxpayer is not required to commit to either prepayment method on a month-by-month basis. The two prepayment options are:

a. Two (2) equal electronic funds transfer prepayments calculated and prescribed by the Department. Each prepayment will be equal to forty percent (40%) of the taxpayer's monthly average gross receipts tax due for the preceding year. The two (2) payments will be due on or before the twelfth (12^th) and twenty-fourth (24^th) days of the current month. Any remaining balance of tax due for the current month should be remitted along with the taxpayer's gross receipts tax report (Form ET400), which must be filed on or before the twentieth (20th) day of the following month; or

b. One (1) electronic funds transfer prepayment calculated by the taxpayer of at least eighty percent (80%) of the total amount of tax that will be due for the current month. This single prepayment will be due on or before the twentyfourth (24^th) day of the current month. Any remaining balance of tax due for the current month should be remitted along with the taxpayer's gross receipts tax report (Form ST400), which must be filed on or before the twentieth (20th) day of the following month.

E. ELECTRONIC FUNDS TRANSFER. Ark. Code Ann. § 26-19-101 et seq.

1. Each taxpayer whose monthly liability for gross receipts tax or compensating use tax exceeds $20,000.00 shall pay the taxes due by electronic funds transfer. Monthly liability is determined on the basis of average monthly liability for the preceding year. The transfer shall be made no later than 3:00 p.m. C.S.T. one (1) business day before the payment due date so that payment is received on or before the due date.

2. For purposes of this rule, "electronic funds transfer" means any transfer of funds, other than a transaction originated by check, draft, or similar paper instrument, that is initiated through an electronic terminal, telephone, computer, or magnetic tape for the purpose of ordering, instructing, or authorizing a financial institution to debit or credit an account.

F. FAILURE TO PAY BY ELECTRONIC FUNDS TRANSFER.

1. A taxpayer that is required to pay taxes by electronic funds transfer and fails to do so is subject to certain penalties and is disallowed the advantage of certain benefits otherwise allowed. Any such taxpayer who fails to pay the amount of tax required on or before the due date of such payment shall be assessed a penalty in the amount of five percent (5%) of the amount of tax due. This penalty is in addition to other penalties imposed under the Arkansas Tax Procedure Act, Ark. Code Ann. § 26-18-101 et seq. (See GR-85.) In addition to such penalties, any such taxpayer who is required to pay by electronic funds transfer and fails to do so by the due date of such payment shall not be allowed the benefit of the discount for prompt payment, or the discount for timely remitting the prepayments required of taxpayers whose average net sales exceed $200,000.00 per month.

2. A taxpayer is considered to have failed to pay taxes by electronic funds transfer if either of the following conditions are not met:

a. In order for an electronic funds transfer by automated clearinghouse "debit" to be effective, the following conditions must be met on or before the due date of the payment:

(1) The taxpayer initiates the automated clearinghouse debit by calling the designated toll-free telephone number by 3:00 p.m. C.S.T. on the last business day prior to the due date;

(2) The taxpayer must have accurately provided the Director with sufficient information from which the payment may be applied to the correct account, including, but not limited to, the taxpayer's name, account number, tax type, tax period, and the amount of the payment; and

(3) The taxpayer's bank account designated as the account to be debited contains adequate funds to cover the payment of taxes by debit transfer at the time the debit transaction is initiated and continuing through the due date of the tax payment.

b. In order for an electronic funds transfer by automated clearinghouse "credit" to be effective, the following conditions must be met on or before the due date of the payment:

(1) The taxpayer must have initiated a successful prenote or test transaction containing necessary information in cash concentration or disbursement plus tax payment addendum (CCD + TXP) format. The term "tax payment addendum format" means a technical format for the communication of limited tax remittance data accompanying a payment through the automated clearinghouse system and includes a list of standard tax-type and account-type codes;

(2) The transfer must contain an electronic addenda which allows the Director to identify the taxpayer, tax account number, tax payment amount, tax type, and tax period in accordance with instructions provided by the Director;

(3) The taxpayer must have transferred the amount of funds due; and

(4) The taxpayer's designated bank account must contain adequate funds to cover the credit transfer at the time the credit transaction is initiated and continuing through the due date of the tax payment.

3. The Department provides an alternative method for making a "same day" payment if an electronic funds transfer for payment of all remittances required under the provisions of Arkansas law fails for any reason. If an electronic funds transfer fails on its due date, then the taxpayer should contact the Department at (501) 682-7105 and provide the following information:

a. Arkansas Sales Tax Permit Number;

b. The tax type code;

c. The tax period end date;

d. Payment amount; and

e. Account information.

G. Returns and remittances by the taxpayer as described in this rule do not constitute an assessment of tax for audit or examination purposes.

006.05.06 Ark. Code R. 005-GR-77

Ark. Code Ann. §§ 26-19-101 et seq.; 26-21-108; 26-52-501