The City of Roanoke will co-sponsor the event "Taxes in Business Workshop: Learn the What, When and Why." The workshop was targeted to business owners to help participants understand local and state tax responsibilities. Presenters outlined various business tax requirements and their purpose, the impact of delinquent taxes on a business, and basic business principals to help manage a business more efficiently. Participants also had a chance to meet one-on-one with tax and business advisers. Sandy Ratliff with the Virginia Department of Business Assistance outlined the resources available to small business owners within Virginia.
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Roanoke Taxes in Business Workshop Resource Presentation, August 4, 2010
1. Roanoke Taxes in Business Workshop: Learn the What, When & Why August 4, 2010
2. Business Resources in Virginia Sandy Ratliff, Business Services Manager Virginia Department of Business Assistance 276-676-3768 sandy.ratliff@vdba.virginia.gov www.vdba.virginia.gov www.vastartup.org
5. Small Businesses account for half of the Commonwealth of Virginia’s contribution to the U.S. Gross Domestic Product - a whopping $160 billion. Virginia is for Business Lovers
6. Virginia is for Business Lovers Virginia ranked #1 state for business by Forbes.com last four years. Ranked #1 most business friendly state by Pollina Corporate Real Estate, Inc. last two years. Named #1 best states for business by CNBC. Virginia among top 10 list of states friendly to small business.
7. The Virginia Department of Business Assistance VDBA supports economic development in the Commonwealth by working with new and existing businesses to provide business and economic development communities with: workforce incentives financing business information and counseling state procurement assistance educational opportunities www.vdba.virginia.gov
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9. Bridges the 26 state agencies, over 110 regulatory programs and over 300 forms that may touch a Virginia business
22. One–on-One Counseling Sessions Need Based: Accessing New Markets/Sales Growth Tailored Sales Development Solutions Financing Resources Social Media for Your Business To schedule an appointment, contact: Sandy Ratliff, Business Services Manager 276-676-3768 Email: sandy.ratliff@vdba.virginia.gov Upcoming Sessions: August 31 – Vinton Chamber of Commerce September 30 – Roanoke County Administration December 1 – Roanoke County Administration
40. Not a grant- analyze cash flow and collateral VSBFA can help you grow by extending you credit Scott Parson- VSBFA Director, 804-371-8256
41. “If you always do what you’ve always done, You will always get what you’ve always got!”
42. Lets Connect: Sandy Ratliff The Virginia Department of Business Assistance 276-676-3768 sandy.ratliff@vdba.virginia.gov Online: Twitter: http://twitter.com/sandyratliffFacebook: http://www.facebook.com/sandy.ratliff LinkedIn - http://www.linkedin.com/in/sandyratliff
45. Mailing and Collection Schedule Estimated State Income Tax Due Dates are: May 1 June 15 September 15 January 15
46. Mailing and Collection Schedule Business License Statements are mailed in December and are due March 1 Business License Statements-Delinquent are mailed in April
47. Mailing and Collection Schedule Real Estate First Installment Statements are mailed in August and are due in October Real Estate First Installment-Delinquent Statements are mailed in November Real Estate Second Installment Statements are mailed in February and are due in April Real Estate First/Second Installment-Delinquent Statements are mailed in May
48. Mailing and Collection Schedule Personal Property Statements which includes Business Personal Property Statements are mailed in mid-April and are due June 1 Personal Property Statements-Delinquent which includes Business Personal Property Statements-Delinquent are mailed in July
51. What are Local Taxes and What are the Tax Rates? Prepared Food & Beverage “Meals Tax” - 7% Transient Occupancy Tax - 7% Admissions Tax - 5.5% or 9% For Guidelines and Additional Information http://www.roanokeva.gov/localtax http://www.roanokeva.gov/mealstax
52. How are these taxes collected? When customers purchase a food or beverage item, purchase a ticket or purchase a hotel room, a tax is added to that price. Customers pay the tax, not the business. The Local Taxes are paid just like State Sales Tax. The monthly tax collected by a business is paid by the 20th of the following month: for example, tax collected for the entire month of July 2010 will be due by August 20, 2010.
53. Why are these taxes called “Trust Taxes” ? These taxes are paid by the customer and then collected by the business providing the service or selling the item or product. The tax is then held “in trust” on behalf of the locality until it is remitted and paid on the due date. Because these taxes are a “trust” tax, penalties can be severe for non-payment.
54. What are the penalties for non-Payment? Each tax has it’s own penalty and/or interest rate depending upon the type of tax. Generally, there is a 10% late payment penalty and for some taxes, interest at a rate of 10% applies. Additional Fees as prescribed by the Code of Virginia may also be imposed for late payment and collection action. Failure to report and pay the tax also constitues a Class 1 Misdemeanor which carries a fine of $2,500 or 12 months in jail or both. In severe cases, failure to remit a trust tax may result in a charge of embezzlement. Business owners may be personally charged and liable for the tax even if the business is a corporation or partnership.
55. What can I do to prevent these penalties? First, Always pay on time. Do not use the taxes collected for payment of other bills or expenses of the business. Establish a separate bank account and deposit the taxes collected into this separate account.
56. What happens if I have problems? Call us and we will work with you It’s always better to file the return form than to not report or pay by the deadline Based on circumstances, a short payment plan may be an option It’s always a good idea to make a partial payment than “no” payment Keep in communication with us concerning your account
57. Does anyone ever check to determine if I am reporting correctly? Yes, We perform random audits of businesses’ records Yes, Field Visits are ongoing throughout the year. Yes, we receive anonymous calls and tips when customers feel they are not charged correctly. These are investigated. Yes, We cooperate with other agencies such as the Department of Taxation, ABC Agents, and the Commissioner of the Revenue’s Office.
58. What Kinds of Records Should I Keep if my business is Audited? The law requires maintaining records to support the tax amounts collected and paid for at least 3 years. Examples of records to keep: Cash Register Tapes and Guest Checks Daily Balancing Reports Records of Voids, over-rings, tips Invoices of food and beverage purchases Bank Account Records and Credit Card Charge receipt records Documentation to support any deductions Daily lists of customers such as records of room rentals at a hotel Tax returns and bank account information for the business Lists of ticket prices, volume of ticket sales, coupons, discounts
59. Who Do I Contact With Questions? Billings & Collections Local Tax Administration, Delinquent Collections, Tax Sale, Parking Tickets, Set-Off Debt Collection, Accounts Receivables: (540) 853-2880 Mailing Address: Noel C. Taylor Municipal Building 215 Church Ave., SW, Room 252 Roanoke, VA 24011 E-Mail: billings@roanokeva.gov www.roanokeva.gov/billings
62. VIRGINIA BUSINESS TAXES INCOME TAXES Corporation Income Tax Employer Income Tax Withholding Individual Income Tax Pass-Through Entities
63. SALES AND USE TAXES Aircraft Sales and Use Tax Communications Sales and Use Tax Consumer’s Use Tax Digital Media Fee Retail Sales Tax Use Tax Vending Machine Sales Tax Watercraft Sales and Use Tax
66. MAJOR TAXES AND FEES ADMINISTERED BY OTHER STATE AGENCIES Alcoholic Beverage Control Tax and Licenses Corporation Charter, Corporation Registration, License Tax on Insurance Companies, and Tax on Public Service Corporations Electric Utility Consumption Tax and Natural Gas Consumption Tax
67. MAJOR TAXES AND FEES ADMINISTERED BY OTHER STATE AGENCIES ( Continued ) Motor and Special Fuel Tax, Licensing and Titling of Motor Vehicles Sales Tax Virginia Unemployment Tax Workers’ Compensation