Sales/Use Taxes, Etc.
Texas Sales and Use Taxes
As a State of Texas agency, the University is exempt from the payment of state and local sales and use taxes within the State of Texas on taxable items sold, leased, or rented to, or stored, used, or consumed by the University in accordance with sections 151.309 and 156.102, Texas Tax Code.
The University is not exempt from the collection and remission of state and local sales taxes for taxable items sold by the University. All applicable state and local sales taxes will be collected and submitted to the state for department sales to students, employees, or the general public.
Texas Hotel Occupancy Taxes
The University is exempt from payment of the state portion of hotel occupancy taxes for lodging establishments in Texas but is not exempt from payment of the local portion of hotel occupancy taxes for Texas lodging establishments.
Campus Student Housing Rentals
Sales of student housing rentals by the University are not subject to collection of state or local hotel occupancy taxes. A dormitory or other housing facility owned or leased and operated by an institution of higher education and used by the institution for the purpose of providing sleeping accommodations for persons engaged in an education program or activity at the University is excluded from the definition of a hotel under Texas Tax Code 156.001 (2).
Taxes Imposed by Another State
The University is not exempt from payment of taxes imposed by another state.
Departments purchasing items for use by the University shall claim exemption from sales and use tax within the State of Texas in every possible case. Employees must present the UHV Texas Sales and Use Tax Exemption Certificate to the vendor when making a purchase so when invoiced/charged the sales tax has already been removed.
See the UHV ProCard Manual Payment of Sales Tax for further guidance on claiming exemption from sales and use tax when using a ProCard for purchases..
In compliance with Texas Administrative Code Title 34, Part 1, Chapter 3, Subchapter O, Rule 3.322 Exempt Organizations, the following rules apply:
- We cannot claim sales tax exemption for travel meals.
- We cannot claim sales tax exemption for business meals when the employee makes payment using cash or a personal payment card.
- The sales tax exemption can be claimed for business meals where the employee pays using a University P-Card or Travel Card (if in travel status), or if the meal is paid for directly by the University.
Departments shall calculate and collect sales taxes for all taxable items sold unless a properly completed and signed Texas Sales and Use Tax Resale Certificate/Exemption Certificate is obtained from the purchaser and a copy is 1) attached to the deposit form for cash and check sales, or 2) maintained by the department for credit card sales. Deposit forms for taxable sales should have revenues and sales taxes itemized separately using proper taxable revenue accounts.
The Finance Office can assist in providing sales tax guidance to departments. Additional guidance to determine whether a sale is subject to sales tax may be found at the following websites:
State of Texas Rules and Regulations for Sales and Use Tax
State of Texas Sales Tax Publications
If, upon review of a deposit by the Finance department, it is determined that sales taxes were not collected on a taxable sale and a properly completed and signed Texas Sales and Use Tax Exemption or Resale Certificate is not attached, Finance personnel will calculate the sales tax due and reduce the amount of departmental revenue by that amount.
Texas Hotel Occupancy Taxes
Persons traveling on official University business inside Texas shall claim exemption from the state portion of hotel occupancy tax, using a UHV Texas Hotel Occupancy Tax Exempt Certificate.
Payment of Exempt Taxes
If an employee chose to pay for a purchase in the State of Texas and be reimbursed rather than purchasing through the university using the UHV Texas tax exempt status, sales taxes paid in Texas will not be reimbursed to the employee.
If State and local sales tax is charged and/or paid for a purchase of goods or services for the university or the State portion of hotel occupancy taxes, the employee should make every attempt to recouped sales tax paid or have the sales tax removed prior to payment regardless of payment method. If sales tax paid exceeds $10, it is mandatory to recoup the sales tax.
Sales Tax Exception
An employee is not required to present the UHV Texas Sales and Use Tax Exemption Certificate for a business meal at a restaurant and sales tax may be paid whether paid by ProCard or reimbursement but should note on the expense report the tax was paid. Please note that this exemption is only for business meals consumed at a sit-down restaurant, if placing an order for business meals the UHV sales tax exemption certificate must be presented.
- UH System Administrative Memorandum 03.A.12
- Texas Comptroller of Public Accounts Accounting Policy Statement 008
- Texas Hotel Occupancy Tax Exemption Certificate (Blank)
- Texas Sales and Use Tax Resale Certificate/Exemption Certificate (Blank)
Signature Obtained 05/05/2023
Robert K. Glenn, Ph.D.
Next review date: May 2028 (5 years)
Origination: Finance Department