Kentucky Administrative Regulations › Title 103 - FINANCE AND ADMINISTRATION CABINET - DEPARTMENT OF REVENUE › Chapter 27 - Sales and Use Tax; Miscellaneous Retailer Occupations › Section 103 KAR 27:180 - Vending machines

Current through Register Vol. 51, No. 1, July 1, 2024
RELATES TO:
				KRS
				139.010,
				139.240,
				139.260,
				139.470,
				139.485,
				139.720
NECESSITY, FUNCTION, AND CONFORMITY:
				KRS
				131.130(1) authorizes the
				Department of Revenue to promulgate administrative regulations to administer
				and enforce Kentucky's tax laws. This administrative regulation establishes the
				requirements when interpreting the sales and use tax law as it applies to sales
				of tangible personal property through vending machines.
Section 1. Definition. "Bulk vending machine"
			 is defined by
			 KRS
			 139.470(5).
Section 2. Persons who own vending machines
			 that dispense tangible personal property, or operators of the machines under
			 lease or rental agreements, shall complete a "Kentucky Tax Registration
			 Application", Revenue form 10A100, to obtain a Kentucky Retail Sales and Use
			 Tax permit to engage in the business of selling tangible personal property and
			 shall report and pay to the department the tax upon the gross receipts from
			 sales made through the machines by utilizing Revenue Form 51A102, "Sales and
			 Use Tax Return". One (1) permit shall be sufficient for all machines of one (1)
			 owner or operator.
Section 3. The
			 owners or operators of vending machines shall be responsible for reporting and
			 paying the tax on the total gross receipts even though the owner or operator of
			 the place in which the machines are located receives a share of the gross
			 receipts under a commission or concession contract. In reporting and paying the
			 tax, the owner or operator shall be deemed the agent of the operator or owner
			 of the place of business in which the machine is located to the extent of
			 commissions due the latter. Gross receipts from bulk vending machine sales of
			 tangible personal property made in portions of fifty (50) cents or less are
			 exempt from the sales and use tax pursuant to
			 KRS
			 139.470(5).
Section 4. A statement in the following form
			 shall be affixed upon each vending machine in a conspicuous place: "This
			 vending machine is owned (operated) by _______ Owner (Operator), __________
			 Place of Business of Owner (Operator), who holds Permit No. _____, issued
			 pursuant to the Sales and Use Tax Law."
Section
			 5. If the owner or operator of vending machines also places upon
			 each machine a statement that the sales tax is included in the price of the
			 property dispensed, the liability for the tax may be computed in the same
			 manner as all other retailers who separately state the tax.
Section 6. Adequate and complete records
			 shall be kept by the owner or operator showing the location of each vending
			 machine owned or operated, the serial number thereof, purchases and inventories
			 of merchandise bought for sale through each machine, and the gross receipts
			 derived from each location during each tax period.
Section 7. Forms. The forms listed within
			 this administrative regulation may be inspected, copied, or obtained:
(1) At the Kentucky Department of Revenue,
			 501 High Street, Frankfort, Kentucky 40620;
(2) At a Kentucky Taxpayer Service Center;
			 or
(3) On the department Web site
			 at
http://revenue.ky.gov
.