Sales Tax Issues

Meals & lodging are common travel expenses that are often subject to sales taxes, occupancy taxes, gross receipts taxes, excise taxes or value added taxes.  Tax treatment is based on facts, circumstances, and the laws in the jurisdiction where the transaction occurs.  Facts vary and tax laws, regulations and interpretations are subject to change.  Therefore, there is no travel-related expense that is uniformly tax exempt.

In-State
Exemption from Connecticut State sales tax for purchases of meals or lodging requires that:

  1. Expense is incurred for University business;
  2. A properly completed Connecticut State Exempt Organization Certificate, CERT-112 (available on Public Folders under Business Office Travel Information) is presented at time of purchase; and
  3. Payment is made directly by the University. Payment by personal credit cards does not generally meet that condition.  However, most Connecticut vendors will accept the corporate card with Sacred Heart University’s name on it.

Cert-112 allows an exempt entity to purchase meals or lodging, or both, tax exempt for a single event and may not be used for repeat purchases.

Out-Of-State
Certain lodging and meal expenses incurred while traveling on University business trips may be exempt from state sales tax provided the following three conditions are met:

  • the state allows an exemption for meals and/or lodging expenses
  • the University holds a state tax exemption certificate in the state of travel, where required
  • the University makes payments directly to the hotel or restaurant using a University credit card or check

The list of states in which the University currently qualifies for travel related sales tax exemption (and/or the documentation required for state sales tax exemption) is provided on Public Folders under Business Office Travel Information.