June 16, 2015
Re: § 58.1-1821 Refund Application: Retail Sales and Use Tax
Dear *****:
This is in response to your letter submitted on behalf of ***** (the "Taxpayer") in which you request a refund of use tax paid to the Commonwealth. I apologize for the delay in responding to your correspondence.
FACTS
The Taxpayer is an out-of-state business that has been performing work in Virginia since 2007. Pursuant to Virginia Tax Bulletin (VTB) 88-11 (9/13/88), the Taxpayer paid the special use tax on construction equipment that it brought into Virginia. Based upon correspondence with Department personnel, the Taxpayer learned that it was not required to pay the tax on its equipment brought into Virginia. Based upon this correspondence, the Department authorized a refund for taxes paid by the Taxpayer for the periods March 2011 through September 2013. The Taxpayer requests a refund of taxes paid for the periods prior to March 2011.
DETERMINATION
Virginia Code § 58.1-1823 states in pertinent part that "Any person filing a tax return or paying an assessment required for any tax administered by the Department of Taxation may file an amended return...three years from the last day prescribed by law for the timely filing of the return...."
Title 23 of the Virginia Administrative Code (VAC) 10-210-3040 states, in pertinent part, that "Refunds cannot be authorized unless the request is made within three years from the due date of the return."
In Commonwealth v. Ferris, Co., 120 Va. 827, 92 S.E. 804 (June 14, 1917), the Supreme Court of Virginia held that "The general rule is well stated that taxes voluntarily paid cannot be recovered back in the absence of a statute providing for their repayment."
In this instance, the Taxpayer requests refunds of taxes paid prior to March 2011. The Department's records show the refund request was submitted to the Department in April 2014. In accordance with Va. Code § 58.1-1823, Title 23 VAC 10-210-3040 and Commonwealth v Ferris, Co., the Department does not have the authority to issue a refund outside of the three-year statute of limitations. Accordingly, the Taxpayer's request for refund of taxes paid prior to March 2011 is denied.
The Code of Virginia section, regulation and Tax Bulletin cited are available on-line at www.tax.virginia.gov in the Laws, Rules and Decisions section of the Department's web site. If you have any questions about this response, you may contact ***** in the Office of Tax Policy, Appeals and Rulings, at *****.
Sincerely,
Craig M. Burns
Tax Commissioner
AR/1-5989282260.P
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