A prepared food or beverage is defined as any food or beverage that has been altered (other than solely by cooling) by preparing, combining, dividing, heating, or serving, in order to make the food or beverage available for immediate human consumption.
In addition to establishments such as restaurants, sandwich shops, and delicatessens, this tax also applies to any establishment that dispenses any beverage or prepares any type of food, such as popcorn, cotton candy, etc.
A rate chart is available to assist you in calculating the total tax to charge.
The Prepared Food and Beverage Tax does not apply to the following sales of food and beverages:
- Sales through vending machines.
- Retail sales exempt from taxation under G.S. 105-164.13 (Exemptions and Exclusions) on January 1993.
- Sales prepared by someone other than the retailer for immediate consumption and merely placed on display for sale purposes. Examples include prewrapped sandwiches, packaged crackers, prepacked ice cream, etc.
- Prepared food and beverages served by any establishment subject to the County's Occupancy Tax if the charge for the food or beverage is included in a single, non-itemized sales price, together with the charge for room rental, lodging, or accommodations furnished by the taxable establishment.
- Prepared food and beverages furnished without charge by an employer to any employee.
- Prepared food and beverages served to residents in boarding houses on a periodic basis, which are included with the rental of any sleeping room or lodging.
Does my Business need to file and pay the Prepared Food and Beverage Tax?
Subject businesses are any retailer within Wake County that are subject to sales tax imposed by the State of North Carolina under section 105-164.4(a)(1) of the North Carolina General Statutes, which would include:
- Restaurants
- Cafes
- Cafeterias*
- Coffee shops
- Grills
- Snack bars/carts
- Lounges
- Bars
- Taverns
- Mobile vendors
- Vendors at sporting, cultural, and entertainment events
- Fast food establishments
- Drive-in establishments
- Private club dining facilities
- Caterers
- Independent bakeries
- Grocer and independent delicatessens
- Convenience store/marts
- Luncheon counters/soda fountains at drugstores
- Pharmacies and other general retail stores
- Nightclubs
- Wet bars
- Concession stands
- Ice cream parlors/shops
- Employee cafeterias that charge for food and beverages
- Any other establishment, place of business, or enterprise maintaining facilities, equipment, services, or inventory for the sale of any type or kind of prepared food, food product, meal, or beverage sold to consumers.
*Effective January 1, 2014, prepared food sold to a college student in a dining room, cafeteria, or similar establishment regularly operated by or on behalf of an institution of higher education in this State, including an institution of the University of North Carolina, a private institution of higher education, or by student organizations thereof, is subject to the Wake County Prepared Food and Beverage tax.
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