North Carolina issued a directive addressing the taxability of certain monthly or other periodic leases or rental billings assessed to tangible personal property or digital property. Effective September 1, 2018, anyone who leases or rents tangible personal property or digital property is required to collect and remit the applicable tax on gross receipts derived from those leases or rentals associated with the billing. Those who entered into lease or rental agreement prior to the September 1st effective date, are still subject to the collection and remittance obligations provided in N.C. Gen. Stat. § 105-164.15A, unless otherwise exempt from North Carolina sales and use tax.

This could potentially affect you if you rent or lease tangible personal property or digital property in North Carolina. To register to collect and remit North Carolina sales and use tax, you will need to complete and mail in the application or complete the Online Business Registration.  A qualified tax attorney can assist with the execution of the application and potential questions or concerns that may arise in the process.

Jeanette Moffa is an attorney who concentrates on state and local taxes at Moffa, Sutton, & Donnini, P.A. She is an executive council member of the American Bar Association Tax Section State and Local Tax Committee and the Florida Bar Tax Section. Ms. Moffa is an author of both the CCH’s Expert Treatise Library: Sales and Use Tax as well the ABA’s Sales and Use Tax Deskbook. In addition, her regular columns on state and local tax issues can be found in State Tax Notes and Actionline, a publication from the Florida Bar’s Real Property, Probate, and Trust Law Section. She also serves as assistant editor to the Sales and Use Tax Deskbook and Actionline. Ms. Moffa is a regular speaker at the American Bar Association Tax Section conferences, the Institute of Professionals in Taxation, the Florida Bar Tax Section, the Florida Bar Real Property, Probate, and Trust Law Section, and the FICPA. In her free time, she teaches as an adjunct professor at Broward College.

Posted in Multi-state sales and use tax, North Carolina Sales Tax