Tax Rules: Final: 5703-9
5703-9-03 Sales and use tax; exemption certificate
forms.
(A) As used in this rule, “exception” refers to transactions
excluded from the definition of retail sale by division (E)
of section 5739.01 of the Revised Code. “Exemption” refers to
retail sales not subject to the tax pursuant to division (B)
of section 5739.02 of the Revised Code.
(B) All sales are presumed to be taxable until the contrary
is established. If a purchaser believes an exception or
exemption is available, the purchaser must provide,
electronically or in hard copy, a fully completed exemption
certificate to the vendor or seller. Unless the vendor or
seller fraudulently fails to collect the tax or solicits a
purchaser to participate in an unlawful claim of exemption,
the vendor or seller is relieved of the duty to collect sales
tax on any sale covered by a fully completed certificate.
However, the purchaser remains responsible for any tax found
to be due.
(C) Pursuant to section 5739.031 of the Revised Code, no
exemption certificate need be obtained by or furnished to a
vendor or seller who receives and retains notice, from a
purchaser who holds a direct payment permit that has not been
canceled, of the purchaser’s direct payment permit number and
that the tax is being paid directly to the state. While it is
advisable to obtain an exemption certificate for the
following types of transactions, it is not mandatory that a
certificate be obtained when the identity of the consumer is
such that the transaction is never subject to the tax
imposed, when the item of tangible personal property or the
service provided is never subject to the tax imposed,
regardless of use, or when the sale is in interstate
commerce.
(D)
(1) A unit exemption certificate should be used to cover a
single purchase and must be maintained with the primary
purchase record. The unit exemption certificate may be
incorporated into a purchase order, invoice, or bill of sale.
(2) A blanket exemption certificate should be used to cover
all purchases made on or after the effective date unless the
purchaser specifies that a purchase is subject to the tax.
Blanket certificates must be maintained in a separate
exemption file or may be part of a customer file. The vendor
or seller must charge tax when the purchaser indicates that a
purchase is subject to the tax.
(E)
(1) If a vendor or seller is claiming the resale exception on
the purchase of a motor vehicle, watercraft, or outboard
motor, the vendor or seller may use the forms required to be
prescribed by rule that are hereby prescribed for use as a
unit exemption certificate or as a blanket exemption
certificate. The forms may be obtained from the department of
taxation and are available on the department’s web site. They
may be reproduced as needed. Substitute exemption
certificates may be developed and used as long as they
contain the basic elements prescribed in paragraph (G) of
this rule.
(2) If a vendor, seller, or consumer is purchasing a motor
vehicle, a watercraft that is required to be titled, or an
outboard motor that is required to be titled and is claiming
exception or exemption from the sales and use tax based on a
reason other than resale, the vendor, seller, or consumer
must comply with provisions of rule 5703-9-10 or 5703-9-25 of
the Administrative Code.
(3) If a construction contractor is claiming exemption from
sales or use tax on the purchase of materials for
incorporation into real property, the construction contractor
must comply with the provisions of rule 5703-9-14 of the
Administrative Code.
(F) To cover sales claimed to be excepted or exempted, an
exemption certificate must be obtained within ninety days
subsequent to the date of sale.
(G) To be valid, exemption certificates must contain the
following data elements:
(1) The consumer’s name and business address,
(2) A tax identification (e.g. vendor’s license or consumer’s
use tax account) for the consumer issued by this state, if
any,
(3) The name and address of the vendor or seller from whom
the purchase is being made,
(4) The purchaser’s type of business or organization.
(5) The reason for the claimed exemption, and
(6) If the certificate is in hard copy, the signature of the
purchaser.
If any of these elements is missing the certificate is
invalid.
(H) The following forms are incorporated in this rule by
reference:
(1) The unit exemption certificate, revised March 15, 2004;
(2) The blanket exemption certificate, revised March 15,
2004, and
(3) The exemption certificate form adopted by the Governing
Board of the Streamlined Sales Tax System.
Effective: 11/29/2010
R.C. 119.032 review dates: Exempt
Promulgated Under: 5703.14
Statutory Authority: 5703.05
Rule Amplifies: 5739.01, 5739.02, 5739.03, 5741.02
Prior Effective Dates: 10/5/76, 11/18/78, 7/2/81, 10/18/82,
7/13/92, 6/11/04