W. Va. Code R. § 110-15-14

Current through Register Vol. XLI, No. 24, June 14, 2024

Section 110-15-14 - Maintenance of Records

14.1. Sales and Service Tax Records.

14.1.1. Keeping and Preserving Records. - Each person shall keep complete and accurate records of taxable sales and of charges, together with a record of the tax collected thereon, and shall keep all invoices, bills of lading and such other pertinent documents in such form as the Tax Commissioner may require. Such records and other documents shall be preserved for a period of time not less than three years, unless the Tax Commissioner shall consent in writing to their destruction within that period or by order require that they be kept longer. Records must be kept so long as the period is open to assessment or refund. Any person who fails to maintain appropriate records shall be subject to the provisions of W. Va. Code '11-9-1 et seq.

14.1.1.1. For those transactions in which the purchaser provides to the vendor the direct payment permit number or material purchase certificate number, the vendor shall retain a record copy of the invoice with the direct payment permit number or material purchase certificate number, as applicable, printed thereon.

14.1.2. When Separate Records of Sales Required. - Any vendor engaged in a business subject to the consumers sales and service tax, who is at the same time engaged in some other kind of business, occupation or profession, not subject to such tax, shall keep records to show separately the transactions used in determining the tax base for the sales and services taxed. In the event such person fails to keep such separate records there shall be levied upon him a tax based upon the entire gross proceeds of both or all of his businesses.

14.1.3. Sales to Affiliated Companies or Persons. - In determining gross proceeds of sales of tangible personal property or services other than services exempt under Section 9.3.12 of these regulations from one to another of affiliated companies or persons, or under other circumstances where the relation between the buyer and seller is such that the gross proceeds from a sale are not indicative of the true value of the subject matter of the sale, the tax shall be based upon the fair market value as if in a transaction involving a willing buyer and a willing seller, with neither buyer nor seller being required to act.

14.1.3.1. In those instances where fair market value is not available, determining value in regard to sales from one to another of affiliated companies or persons, or under other circumstances where the relation between the vendor and vendee is such that gross proceeds from the sale are not indicative of the true value of the subject matter of the sale, the following rules shall be applied in the order stated.

14.1.3.1.a. Whenever sales are made to affiliates, the value shall correspond to the gross proceeds from the sale of similar products or services of like quality and character and in similar quantities between persons of no common interest.

14.1.3.1.b. If there are no sales between parties of no common interest by which the taxpayer may value his sales to affiliates, the value shall correspond to the gross proceeds from sales by the taxpayer to nonrelated purchasers of similar products or services of like quality and character and in similar quantities and shall include all subsidies and bonuses.

14.1.3.1.c. In the absence of sales as a guide to value, such value may be determined by a cost basis. In such cases there shall be included every item of cost attributable to the particular article manufactured, including direct and indirect overhead costs. There shall be added to this total manufacturing cost the average markup realized by the taxpayer on all products manufactured, compounded or prepared for sale.

14.1.4. Records of Nonresidents Doing Business in State. - A nonresident person or foreign corporation engaged in a business within this State in the conduct of which the consumers sales and service tax levied becomes due, shall keep within this State adequate records concerning the operation of the business, and all consumers sales and service taxes collected in the course of the business. The amount of the consumers sales and service tax collected shall not be transmitted outside of this State without the written consent of, and in accordance with the conditions prescribed by, the Tax Commissioner.

14.2. Use Tax Records.

14.2.1. Keeping and Preserving Records. - Every retailer required or authorized to collect use taxes and every person using in this State tangible personal property or taxable services shall keep such records, receipts, invoices, and other pertinent papers as the Tax Commissioner shall require and in such form as the Tax Commissioner shall require. For those transactions in which the retailer provides to the vendor the direct payment permit number or material purchase certificate number, the vendor shall retain a record copy of the invoice with the direct payment permit number or material purchase certificate number, as applicable, entered thereon. Any person who fails to maintain appropriate records shall be subject to the provisions of W. Va. Code '11-9-1 et seq.

14.2.2. Examination of Records. - In addition to the Tax Commissioner's powers set forth in W. Va. Code '11-10-1 et seq., the Tax Commissioner is hereby authorized to examine the books, papers, records and equipment of any person who either:

14.2.2.1. Is selling tangible personal property or taxable services; or

14.2.2.2. Is liable for the use tax. The Tax Commissioner may investigate the character of the business of any such person in order to verify the accuracy of any return made, or if no return was made by such person, to ascertain and determine the amount of use tax due. Any such books, papers and records shall be made available within this State for such examination upon reasonable notice. However, where the taxpayer's records must be kept out-of-state, the taxpayer may upon being notified by the Tax Commissioner that an examination is to be made, elect to do one of the following:

(1) forthwith transport the required records to a convenient point in West Virginia and notify the Tax Commissioner of the location where such records are available; or

(2) pay the reasonable traveling expenses of the Tax Commissioner's representatives from Charleston, West Virginia, to the out-of-state place where the records are kept, and the return of such representative to Charleston, West Virginia, and reasonable living expenses of such representatives while engaged in the examination of such records.

W. Va. Code R. § 110-15-14