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Utah law imposes filing and payment requirements depending on a seller's annual sales and use tax liability.
Any seller with a sales and use tax liability of $50,000 or more is required to file and remit sales and use tax monthly.
The return and remittance are due on or before the last day of the month following each calendar month. For example, sales and use tax collected during July are due on or before August 31 along with any other applicable sales-related taxes and fees.
Sellers who timely file monthly returns qualify for a 1.31 percent seller discount on certain sales and use taxes.
Sellers who are not required to monthly file and remit sales taxes to the Tax Commission may voluntarily file monthly by contacting the Tax Commission at least 30 days prior to the beginning of a new fiscal year. Sellers who choose this option are subject to the same requirements and penalties as mandatory monthly filers.
The election to file and remit sales taxes on a monthly basis remains in effect until the seller contacts the Tax Commission in writing and states that it no longer elects to be a monthly filer. The written notice must be made at least 30 days prior to the beginning of a fiscal year. Revocation of monthly status will become effective in the fiscal year following notification.
Any seller whose annual sales and use tax liability totals $96,000 or more is required to remit taxes via electronic funds transfer (EFT) by 7:00 p.m. Mountain Time on or before the due date. The sales tax account must be set up for EFT payments prior to making a payment. Contact the Tax Commission for information at (801) 297-2200, 1-800-662-4335.
Sellers who are not required to remit sales taxes to the Tax Commission by EFT may elect to do so by contacting the Tax Commission at least 30 days before the beginning of a new fiscal year. Sellers who make this election are subject to the same requirements and penalties as those who are required to remit by EFT.
The election to remit sales taxes by EFT remains in effect until the seller contacts the Tax Commission in writing and states that it no longer elects to be an EFT filer. The written notice must be made at least 30 days prior to the beginning of a fiscal year.
Sellers who remit sales tax to the Tax Commission by EFT must file an EFT agreement with the Tax Commission. To file by EFT, download and fill out Form TC-85, Agreement for Remitting Tax by EFT, and send to:
John Collen/Tax Admin
Utah State Tax Commission
210 North 1950 West
Salt Lake City, UT 84134
This form can also be faxed to 801-297-3899, attn: John Collen/Tax Admin. Please remember to include the phone number and fax number of the contact person in your organization.
For more information, contact John Collen at 801-297-3817 or jcollen@utah.gov.
Generally, a seller's EFT payment is remitted by an ACH-debit transaction through the National Automated Clearing House Association (NACHA) system CCD application. Under this procedure, the seller will contact the third party the state contracts with and authorize the third party to initiate the debit to the seller's account. Before initiating the debit, the third party will process the transaction through NACHA and submit appropriate records to the Tax Commission for identification of all EFT payments.
When a seller's bylaws prohibit third-party access to its bank account, the seller may remit payment by ACH-credit with tax payment addendum transaction through NACHA's CCD+ application. Under this procedure, the seller will contact its bank and authorize it to initiate the debit to the seller's account, and then contact the third party to provide necessary information for the Tax Commission. After initiating the debit, the bank will process the transaction through NACHA.
The Tax Commission will assess penalties when a seller does not meet all statutory requirements. Sellers who remit sales tax by EFT must ensure that the funds transfer and return are timely completed.
Utah Code §59-1-401 provides uniform penalties for failure to timely file and remit tax returns.
The penalty for failure to file a tax return by the due date is the greater of $20 or 10 percent of the unpaid tax. If a tax balance remains unpaid 90 days after the due date, a second penalty, the greater of $20 or 10 percent of the tax balance, will be added for failure to pay timely.
The penalty for failure to pay tax due as reported on a timely filed return, or within 30 days of a notice of deficiency, is the greater of $20 or 10 percent of the tax due.
If no tax liability is due and the seller fails to file a zero return, penalties will be assessed based on the estimated amount of tax due.
Monthly returns filed late or underpaid returns will result in the loss of seller discount.
For more information, see Publication 58, Interest and Penalties.