Harvard as Seller - Meals Tax Collection and Payment
General Information
Meals Tax Collection at Harvard
Tax-Exempt Meals
Other Items Subject to Meals Tax
- Tubs are required to collect the 6.25% meals tax at the time of sale
- tax must be separately listed and separately charged on all invoices,
bills or contracts (except those solely for alcoholic beverages);
- The Tub deposits the proceeds from the sale of meals plus the meals
tax into the designated University bank account and retains copy of the validated bank deposit slip;
- Then the Tub forwards the validated bank deposit ticket along with a completed
credit voucher to the Cash Receipts Office;
- credit voucher must list separately the amounts of taxable and nontaxable
meal sales plus meals tax amounts
- After each month-end close, Harvard University Dining Services aggregates
the data and forwards it to Tax Services;
- Tax Services calculates the meals tax and remits the tax for the entire
University to the Massachusetts Department of Revenue on a monthly basis.
The following meal sales at Harvard are exempt from meals tax:
- Sales to Harvard students presenting a valid University ID purchasing
meals in Harvard-operated dining facilities
- Sales from vending machines where each individual item costs less
than $3.50
- Sales of meals to other 501(c)(3) tax-exempt organizations
- Sales of meals directly to the federal or Massachusetts governments
- Sales of beverages in unopened containers of 26 fluid ounces or more
- Meals that require significant further preparation in order to make
them edible. For example:
- If a convenience store sells hot slices of pizza to go, the sale
of the pizza slices is taxable, but
- If the same store sells frozen pizzas that customers take home
to cook then the sale is not taxable because the pizza requires
significant additional preparation
In certain cases, the cost of items in addition to a meal may be included
in the taxable sales price of that meal, for instance:
Gratuities or service charges included as part of the price of a meal
are included in the taxable sales price. For example:
University room rental charges may be included in the taxable sales
price if the following conditions are met:
- The room is rented for the purpose of serving the meal, and
- The meal is provided by the University
NOTE: if a room is rented for purposes other than serving a meal and
light refreshments are provided, the meals tax only applies to the price
of the refreshments as long as the charge is stated separately on both
the bill to the customer and in the University's records.
Example A: A local for-profit business hosts a luncheon
in a function room at the Faculty Club. Both the food served and the
room rental charges are included in the taxable sales price of the
meal.
Example B: The same local for-profit business holds
a training session in a function room at the Faculty Club. During
the training session, beverages and snacks are provided. On the invoice,
the charges for the room rental and the refreshments are stated separately
-- only the sales price of the refreshments is taxable.
Admission charges for entertainment or recreation
Sales tax is imposed on admission charges received by a place of entertainment
where food and/or alcoholic beverages are sold, unless all of the following
conditions are met:
- A ticket is sold and collected as proof of the admission price;
- The customer is not obligated to buy any food or beverage; and
- The admission charges are stated separately in the records of the
place of entertainment
Discounted Meals
If customers presenting a coupon receive a discount from the regular
price of a meal, the discounted price paid is the amount subject to
tax.
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