North Carolina § 105-164 - 16. Returns and payment of taxes.

§ 105-164. 16. Returns and payment of taxes.

General. - Sales and use taxes are payable when a return is due. A return is due quarterly or monthly as specified in this section. A return must be filed with the Secretary on a form prescribed by the Secretary and in the manner required by the Secretary. A return must be signed by the taxpayer or the taxpayer's agent. Quarterly. - A taxpayer who is consistently liable for less than one hundred dollars ($100.00) a month in State and local sales and use taxes must file a return and pay the taxes due on a quarterly basis. A quarterly return covers a calendar quarter and is due by the last day of the month following the end of the quarter. Monthly. - A taxpayer who is consistently liable for at least one hundred dollars ($100.00) but less than twenty thousand dollars ($20,000) a month in State and local sales and use taxes must file a return and pay the taxes due on a monthly basis. A monthly return is due by the 20th day of the month following the calendar month covered by the return. Prepayment. - A taxpayer who is consistently liable for at least twenty thousand dollars ($20,000) a month in State and local sales and use taxes must make a monthly prepayment of the next month's tax liability. The prepayment is due on the date a monthly return is due. The prepayment must equal at least sixty-five percent (65%) of any of the following: The amount of tax due for the current month. The amount of tax due for the same month in the preceding year. The average monthly amount of tax due in the preceding calendar year. Category. - The Secretary must monitor the amount of State and local sales and use taxes paid by a taxpayer or estimate the amount of taxes to be paid by a new taxpayer and must direct each taxpayer to pay tax and file returns as required by this section. In determining the amount of taxes due from a taxpayer, the Secretary must consider the total amount due from all places of business owned or operated by the same person as the amount due from that person. A taxpayer must file a return and pay tax in accordance with the Secretary's direction. Repealed by Session Laws 2001-427, s. 6(a), effective January 1, 2002, and applicable to taxes levied on or after that date. Use Tax on Purchases. - Use tax payable by an individual who purchases an item, other than a boat or aircraft, for a nonbusiness purpose is due on an annual basis. For an individual who is not required to file an individual income tax return under Part 2 of Article 4 of this Chapter, the annual reporting period ends on the last day of the calendar year and a use tax return is due by the following April 15. For an individual who is required to file an individual income tax return, the annual reporting period ends on the last day of the individual's income tax year, and the use tax must be paid on the income tax return as provided in G.S. 105-269.14. Simultaneous State and Local Changes. - When State and local sales and use tax rates change on the same date because one increases and the other decreases but the combined rate does not change, sales and use taxes payable on the following periodic payments are reportable in accordance with the changed State and local rates: Lease or rental payments billed after the effective date of the changes. Installment sale payments received after the effective date of the changes by a taxpayer who reports the installment sale on a cash basis. A sales tax return must state the taxpayer's gross sales for the reporting period, the amount and type of sales made in the period that are exempt from tax under G.S. 105-164.13 or are elsewhere excluded from tax, the amount of tax due, and any other information required by the Secretary. A use tax return must state the purchase price of items that were purchased or received during the reporting period and are subject to tax under G.S. 105-164.6 , the amount of tax due, and any other information required by the Secretary. Returns that do not contain the required information will not be accepted. When an unacceptable return is submitted, the Secretary will require a corrected return to be filed. History (1957, c. 1340, s. 5; 1967, c. 1110, s. 6; 1973, c. 476, s. 193; 1979, c. 801, s. 83; 1983 (Reg. Sess., 1984), c. 1097, s. 14; 1985, c. 656, s. 26; 1985 (Reg. Sess., 1986), c. 1007; 1987, c. 557, s. 6; 1989 (Reg. Sess., 1990), c. 945, s. 1; 1991, c. 690, s. 4; 1993, c. 450, s. 7; 1997-77, s. 1; 1998-121, s. 1; 1999-341, s. 1; 2000-120, s. 11; 2001-347, s. 2.14; 2001-414, s. 18; 2001-427, s. 6(a); 2001-430, s. 7; 2002-184, ss. 10, 11; 2003-284, ss. 44.1, 45.8; 2003-416, s. 26; 2005-276, s. 33.24; 2006-162, s. 5(b); 2006-33, s. 9; 2007-527, ss. 11, 12; 2008-134, s. 11; 2009-451, s. 27A.3(b), (c), (m); 2010-31, s. 31.3(a)-(d); 2010-95, s. 42; 2011-330, s. 21; 2019-169, s. 3.3(p); 2020-58, s. 3.2.) Editor's Note. - Session Laws 2003-284, s. 45.1, provides: "The Streamlined Sales and Use Tax Agreement is an historic multistate agreement designed to simplify and modernize sales and use tax collection and administration. The states and businesses involved in the Streamlined Sales Tax Project recognize that a simplified and uniform system saves businesses compliance and audit costs, while also saving states administrative costs and improving voluntary compliance, which should increase state collections. To participate in the Agreement, North Carolina must amend or modify some of its sales and use tax law to conform to the simplifications and uniformity in the Agreement. This part [Part XLV of Session Laws 2003-284] makes those necessary changes." Session Laws 2003-284, s. 48.1, provides: "Parts 32 through 47 of this act do not affect the rights or liabilities of the State, a taxpayer, or another person arising under a statute amended or repealed by those parts before the effective date of its amendment or repeal; nor do they affect the right to any refund or credit of a tax that accrued under the amended or repealed statute before the effective date of its amendment or repeal." Session Laws 2003-284, s. 1.2, provides: "This act shall be known as the 'Current Operations and Capital Improvements Appropriations Act of 2003'." Session Laws 2003-284, s. 49.3, provides: "Except for statutory changes or other provisions that clearly indicate an intention to have effects beyond the 2003-2005 fiscal biennium, the textual provisions of this act apply only to funds appropriated for, and activities occurring during, the 2003-2005 fiscal biennium." Session Laws 2003-284, s. 49.5 is a severability clause. Session Laws 2005-276, s. 1.2, provides: "This act shall be known as the 'Current Operations and Capital Improvements Appropriations Act of 2005'." Session Laws 2005-276, s. 33.34, provides in part: "For prepayments of telecommunications and direct-to-home satellite services, the first billing period is considered to start on or after November 1, 2005. For prepayments of satellite digital audio radio services or cable services, the first billing period is considered to start on or after February 1, 2006." Session Laws 2005-276, s. 46.5 is a severability clause. Session Laws 2009-451, s. 27A.3(b), effective August 7, 2009, repealed Session Laws 2000-120, s. 11, which, as enacted, would have rewritten G.S. 105-164.16(d) , effective for taxable years beginning on or after January 1, 2010. Session Laws 2009-451, s. 1.2, provides: "This act shall be known as the 'Current Operations and Capital Improvements Appropriations Act of 2009'." Session Laws 2009-451, s. 28.3, provides: "Except for statutory changes or other provisions that clearly indicate an intention to have effects beyond the 2009-2011 fiscal biennium, the textual provisions of this act apply only to funds appropriated for, and activities occurring during, the 2009-2011 fiscal biennium." Session Laws 2009-451, s. 28.5 is a severability clause. Session Laws 2010-31, s. 31.3(e), provides: "When the Secretary of Revenue conducts a review of a taxpayer's sales and use tax payment schedule requirements under G.S. 105-164.16(b3) , the Secretary must identify the taxpayers who are no longer required to make a monthly prepayment of the next month's sales and use tax liability because of the reduction of the sales tax payment threshold under this section and must notify those taxpayers of the change in the taxpayer's payment requirement." Session Laws 2010-31, s. 1.1, provides: "This act shall be known as the 'Current Operations and Capital Improvements Appropriations Act of 2010'." Session Laws 2010-31, s. 32.3, provides: "Except for statutory changes or other provisions that clearly indicate an intention to have effects beyond the 2010-2011 fiscal year, the textual provisions of this act apply only to funds appropriated for, and activities occurring during, the 2010-2011 fiscal year." Session Laws 2010-31, s. 32.6 is a severability clause. Session Laws 2010-95, s. 42, repealed Session Laws 2009-451, s. 27A.3(c), which had repealed the October 10, 2010 effective date for s. 11 (now repealed) of Session Laws 2000-120. Effect of Amendments. - Session Laws 2000-120, s. 11, as amended by Session Laws 2003-284, s. 44.1, and by Session Laws 2005-276, s. 33.24, effective for taxable years beginning on or after January 1, 2010, rewrote subsection (d). Session Laws 2003-284, s. 45.8, as amended by Session Laws 2003-416, s. 26, effective October 1, 2003, substituted "20th day of the month" for "15th day of the month" in subsection (b1). Session Laws 2006-33, s. 9, effective October 1, 2007, substituted "when a return is due" for "quarterly, monthly, or semimonthly as specified in this section" in the first sentence of subsection (a); deleted "but less than ten thousand dollars ($10,000)" following "($100.00)" in the first sentence of subsection (b1); rewrote subsection (b2); in (b3), substituted "as required by this section" for "in accordance with the appropriate schedule" at the end of the first sentence, and "direction" for "direction until notified in writing to file and pay under a different schedule" in the last sentence. Session Laws 2006-162, s. 5(b), effective July 24, 2006, in the second sentence of the second paragraph in (a), substituted "property or services that were purchased" for "property that was purchased" and substituted "are subject" for "is subject." Session Laws 2007-527, ss. 11 and 12, effective August 31, 2007, in subsection (b1), substituted "at least one hundred" for "more than one hundred"; and in the first sentence of subsection (d), inserted "excluding purchases of boats and aircraft." Session Laws 2008-134, s. 11, effective July 28, 2008, added subsection (e). Session Laws 2009-451, s. 27A.3(m), effective August 7, 2009, in subsection (a), in the second paragraph, inserted "digital property" in the second sentence; in subsection (d), substituted "property other than a boat or an aircraft, digital property, or a service" for "property, excluding purchases of boats and aircraft" in the first sentence; and, in the introductory language of subsection (e), deleted "general" following "combined" and "the gross receipts from" following "payable on.". Session Laws 2010-31, s. 31.3(a), effective October 1, 2010, in subsections (b1) and (b2), substituted "fifteen thousand dollars ($15,000)" for "ten thousand dollars ($10,000)." Session Laws 2010-31, s. 31.3(c), effective October 1, 2011, in subsections (b1) and (b2), substituted "twenty thousand dollars ($20,000)" for "fifteen thousand dollars ($15,000)." Session Laws 2011-330, s. 21, effective June 27, 2011, in the introductory paragraph of subsection (d), substituted "purchases the items listed in this subsection" for "purchases tangible personal property other than a boat or an aircraft, digital property, or a service" in the second sentence, and added the last sentence; and added subdivisions (d)(1) through (d)(3). Session Laws 2019-169, s. 3.3(p), effective July 26, 2019, substituted "items" for "tangible personal property, digital property, or services" in the second sentence of the second paragraph of subsection (a); in subsection (d), in the introductory paragraph, substituted "an item, other than a boat or aircraft" for "the items listed in this subsection" in the first sentence, and deleted "The items are" from the end; and deleted subdivisions (d)(1) through (d)(3). Session Laws 2020-58, s. 3.2, effective June 30, 2020, in subsection (d), deleted "Out-of-State" preceding "Purchases" in the heading, and deleted "outside the State" preceding "for a nonbusiness" in the first sentence.