Sales and Use Tax Rulings | Refunds

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GIL-16-005   Refunds

When a purchase of taxable tangible personal property includes a taxable shipping charge and the customer returns the item for a refund, the entire amount of sales tax must be refunded to the customer, including the tax paid on the shipping charge.

GIL-15-002   Contractor Exemption Certificate

If a contractor does not provide a certificate of exemption to a retailer, then the contractor cannot claim an exempt sale and the retailer must charge sales tax on the transaction.  A retailer who fails to charge sales tax in such instances is liable for any sales tax that should have been collected as well as penalties and interest.  If the contractor later obtains an exemption certificate, it may apply to the Department for a tax refund or the retailer may, in its discretion refund the sales tax to the contractor and claim a credit on its sales tax return.

GIL-15-008   Discharged Maintenance Contract

Car owner's warranty, on which owner paid sales tax, was discharged in bankruptcy and owner subsequently purchased replacement parts that would have been provided tax free to owner under the warranty. Car owner not entitled to a refund of sales tax paid on replacement parts. Events subsequent to a taxable event generally do not affect the taxability of the transaction.

GIL-14-008   Membership Fees/Partial Refund

When a membership fee includes both the transfer of tangible personal property and the provision of services (or intangibles) to the buyer, the entire transaction will generally be treated as taxable, unless the true object of the transaction is the acquisition of services (or intangibles) and the value of the tangible personal property is inconsequential. A partial refund of the purchase price presumably means that the buyer has used the property to some extent and, therefore, no refund of tax is allowed.  However, if the refund is for property that has not been used, such as in the case of a canceled magazine subscription and the refund reflects the magazines not yet delivered, then a refund of tax for the partial refund of the purchase price is permitted.

GIL-13-002   Sales Tax Refunds When an Exemption Certificate Is Provided After the Sale

The sales tax refund procedure outlined in the ruling, including the ninety day limitation on refunds by vendor, appears to be consistent with Colorado statutes.

PLR-11-005   Collecting and Reporting of Adjustment Payments

Company collects and reports sales and use taxes as set forth in the Discussion section.

GIL-08-015   Reporting Excess Sales Tax

Discussion on how to report excess tax collected on a sales tax return.

GIL-08-020   Restocking Fees, Travel, Training and Rental of Equipment

A retailer who charges a restocking fee has not refunded the full purchase price and is not entitled to a refund of any tax.  Travel and training are not taxable.  Rental of property is taxable.

GIL-08-033   Sale of Condominium Furnishings

Developer who purchased and paid tax on furnishings for condominium units that it owned and later sold to fractional interest owners is liable for sales tax on such sale and may be entitled to refund of tax paid to suppliers for such furnishings.  Developer liable for sales tax when it rents on a nightly basis condominiums to third-parties.

GIL-07-021   Sales Tax Refunds for Completed Transactions

Buyer purchased taxable property then asked retailer to rebill the purchase to a third-party.  Retailer is entitled to refund of sales tax for completed transactions only if retailer would have granted full refund to buyer even in absence of buyer's request to rebill transaction to a third-party.