POLICYANDPROCEDUREMANUAL

SOPNO:ACCTGAR0081215
DEPARTMENT: ACCOUNTINGSUBSECTION:ACCOUNTSRECEIVABLE
SUBJECT:
SALESTAXCOLLECTIONS&EXEMPTIONSISSUEDATE:DECEMBER14,2015

POLICY:EachAtriumpropertyengagesinthebusinessofsellingatretail,andisthereforerequiredtocollect
andremittheappropriatestateandlocalsalestaxesinthejurisdictionsinwhichtheyoperate.

PROCEDURE:

TheDirectorofAccountingisresponsiblefor:
Properlyapplyingallapplicablesalestaxtorevenues
Verifyingtaxexemptdocumentationprovidedbycustomers
Ensuringthatallapplicabletaxesarepostedproperly,andtotheproperguestaccount
CorrectlyrecordingallpostedtaxesontheDailyRevenueReport
Collectingallrevenueandpropertaxesfromthecustomer

Salestaxesaretheeconomicresponsibilityoftheultimateuseroftheacquiredgoodsorservices.Asa
provideroftaxableservices,itisourdutytocollectthepropersalestaxonalltaxablepurchases,andtoremit
thesetaxestothegovernment.Foreverysaleoftaxablegoodsorservices,wemusteithercollectthe
appropriatesalestax,orsufficientdocumentationtoestablishthepurchasersexemptionfromthetax.

InadditiontoRoom,Food,andBeverage,taxwillbeimposedonthefollowingitems:(variesfromstateto
statecheckyourlocalregulations)
NoshowRevenue
CoverCharges
TelephoneCharges
Fax&Photocopies
GuestDryCleaning
PremiumTelevision,InRoomMovies&Games
Golf&OtherActivityFees
BanquetServiceChargesandSimilarFees
o Notethatnotallbanquetservicecharges/gratuitiesaretaxable.Ifthechargeismeant
solelyasagratuityfortheservers,and100%ofthefeegoestotheservers,thiswillnot
besubjecttotax.Ifanyportionofsuchachargeisretainedbythehouse,theentire
amountbecomessubjecttosalestax.
RoomService,ValetParking&BaggageService
Vending&GameMachineCommissions
StoreRentals
EquipmentRentals
ClubDues
SalvageSales
GiftShop/SundryShopIncome

EXEMPTIONS
Notethattherulesfordeterminingaguestsqualificationforanexemptionfromtaxdifferfromstate
tostate,andareoftencomplex.Youshouldchecktheregulationsinyourlocaletoverifyand/or
confirmwiththeCorporateOfficetaxspecialist.

QualifyingGovernmentandCharitableOrganizations
o Mustprovideastateissuedcertificateoridentificationcardestablishingtheir
organizationsqualificationforexemption,or
o MustprovideofficialdocumentationfromtheInternalRevenueServicestating
exemptions
o Somestatesalsorequirethatpaymentbemadedirectlyfromfundsbelongingtothe
qualifiedorganization.

PermanentResidents(LongTermStay)
o Manystatesprovideanexemptionforalongtermstayofaminimumof30nights.
Typically,taxexemptstatusisgrantedwhentheguest
Hasalreadystayedtheminimumnumberofcontinuousnights,or
Hasdemonstratedacommitmenttolongtermresidencybysigningacontract
withthehoteland/orpayingadepositsufficienttocovertheminimumstay
required.
o Foratransientguesttoreceivethelongtermstayexemption,theymustbooktheentire
30+nightsontheiroriginalreservation.Theymaynotbookfewernightsandthen
extend.

MinimumRoomContracts(AirlineCrew,etc.)
o MinimumRoomAgreementsmadewithAirlines,etc.mustspecifythenumberofrooms
thattheairlinehascontractedtooccupyforthecontracttermandmustclearlyestablish
theirliabilityfortheserooms.Provisionsrelatingtochanges,cancellations,andno
showsmustalsobeclearlystated.
o Inthecaseofbookingsformultiplerooms,thenumberofroomsthatcanbeconsidered
exemptislimitedtothefewestnumberofroomsthathavebeenusedfortherequired
continuoustimeperiod.
Example:Airlinecrewoccupies20roomspernightfor29days,thenonday30,
theyonlyoccupy19rooms.Inthisexample,only19roomsareexemptfromtax
forthe30dayperiod,andallotherroomswillhavetaxcharged.(19roomsx30
days=570roomsexempt,1roomx29days=29roomsfullytaxed.599room
nightstotalforthemonth)
Oftentimes,acompanymaychoosetopayforthenoshowroomsasameans
ofmaintainingthecontinuityoftherental,andpreservingtheireligibilityfor
exemption.Moststatesdonotrequireactualoccupancy,onlythattheguestor
companyhaseconomicresponsibilityfortherooms.

OnlineTravelAgents(PortlandOnly)
o Atthistime,PortlandistheonlycitythatconsidersastaybookedatahotelviaOTA
(Expedia,Priceline,etc.)asexemptfromtaxduefromthehotel.TheOTAisresponsible
forpayingthetaxdirectlytothetaxingauthorities.

Page 2

Theseroomsshouldeitherberunastaxexemptorpostedwithtax,
subsequentlyadjustedoff,andappropriatelyreportedastaxexemptrooms.
AnydocumentsreceivedfromtheOTAshouldberetainedasbackup,aswellas
reportsfromyourPMSshowingallOTAreservationsforthemonth,ifithasthat
capability.

Intheeventthattheexemptdocumentationisinsufficient,thenwemustalwayspostthetax.Ifwe
receivedocumentationatalaterdate,wecansubsequentlyadjustoffthetaxandrecordthis
exemptioninthemonthoftheadjustment.
o Remember,whenitcomestothelaw:Youdontwriteit,youjustreciteit.

FranchisemandatedFreeNightStayroomsarenotconsideredtaxexemptbystateandlocaltaxing
authorities.IftheFranchisedoesnotreimbursethetaxonthesestaysitmustbeallowancedoffand
expensedtotheaccountforLoyaltyPrograms.

ENDOFMONTHREPORTING
Eachmonth,inyourendofmonthreportingpackage,youmustincludethefollowing:
o CompletedandaccurateTaxExemptWorksheet(ACCTGAR008TaxExemptWorksheet
RefertoinstructionsincludedontheWorksheet)sentinExcelformat
CompletedHotelName,HotelCode&AccountingPeriod/Month
CompletedRoomsTab
CompletedBanquet&RestaurantTab
IfyouhavezeroTaxExemptforthemonth,youmuststillremittheTaxExempt
Worksheet,completewithHotelName,HotelCode,Month,andtheword
NONEonthefirstlineoftheRoomsexemptionspreadsheettoindicatethere
werenoroomsexemptions,and/orNONEonthefirstlineoftheBanquet&
RestaurantspreadsheettoindicatetherewerenoBanquet&Restaurant
exemptions.
o ItistheresponsibilityofthehotelDirectorofAccountingtoretainallbackupforeach
exemptionontheTaxExemptWorksheet.Thisinformationwillberequestedfromtime
totimeandwillberequiredintheeventofanaudit,oriftheCorporateOfficehasany
questionsonanexemptionyouhavelisted.Anyandallinformationthatmayrelateto
theexemptstatusmustberetainedonproperty,inamonthlyfile,inorderofexemption
listedontheTaxExemptWorksheet;thisincludes,butisnotlimitedto:
GuestorGroupFolio
TaxExemptionCertificates
TaxExemptionIDsorTaxIDNumbers
StateExemptionLetters
InternalRevenueServiceLetters
CopyofRoomorGroupContracts
BanquetEventOrders
BanquetContracts
Backupshouldberetainedforseven(7)years.
o Ifthereisavariationofmorethan$50intaxcollectedversustaxcalculated/paidforthe
month,youmaybeaskedtosupplyanexplanationand/ordoathoroughinvestigationof
taxproceduresandpostingsatyourpropertytofindtheamountandthenatureofthe
error(s).

Page 3