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You must include documentation with your return in order for exemptions to be considered. You will be notified by e-mail if any documentation is missing and be given five days to provide it. Failure to provide the requested documentation will result in the tax being calculated on the total gross receipts without deducting any exemptions for the month.
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A restaurant as defined within subdivision 9 of section 35.1-1 of the Code of Virginia is any place where food is prepared for service to the public on or off the premises.
Restaurants include but are not limited to:
Also included on a limited basis are:
Food served from delicatessen counters at Convenience and Grocery Stores is also subject to the tax.
A meal is any prepared food and beverages offered or held out for sale by a restaurant or caterer for the purpose of being consumed by an individual or group of individuals at one time to satisfy the appetite, whether prepared in such restaurant or not.
The current tax rate is 6%. Reports should be filed and tax paid by no later than the 20th of each month to avoid the levy of penalties and interest. When the 20th falls on a weekend or holiday, the due date is the first business day immediately following the 20th. Mailed filings must be postmarked by the due date to be considered timely. If the filing is paid late, there is a penalty of 5% of the tax due with a minimum penalty of $2.00. Interest will begin to accrue once the filing or payment is thirty days past due. If we have not received your filing by the end of the month, you will be notified by mail reminding you to file within seven days to avoid a statutory assessment wherein we levy an assessment based on the best available information at our disposal.
Please provide a valid e-mail address on the return.
If you conduct no sales in a given month, you must still file a zero dollar return by the 20th.
You may file and pay online by visiting www.charlottesville.gov/COR and clicking the “Meals & Lodging Taxes” link. All fields on the online form must be filled in completely. Please be careful when entering bank routing and account numbers. These numbers should match exactly what is printed on the bottom line of your paper checks. Incorrect account and routing numbers may be rejected by the payment processor. Payments of $10,000.00 or more cannot be accepted by our online processing system and must be submitted with a paper return and check. If a check is being issued by a bank or a bill paying service, please advise us that the remittance is coming under separate cover. Make sure your account number is correct on the check.
A 3% discount on the tax due is available for those who file and pay timely by the due date each month. If a filing is submitted by the due date but fails to include a payment, the discount will be disallowed and the tax due will be calculated at 6% with penalties and interest levied. You will be invoiced for the total amount due.
No. The meal, or prepared food, is subject to the Meals Tax whether it is intended to be consumed on the seller’s premises or elsewhere and without regard to the manner, time or place of service.
It depends. Yes, for a caterer whose business is located in the City of Charlottesville, regardless of the place of service of the prepared food. No, if the caterer’s business is located outside of the corporate limits of the City of Charlottesville and regardless of the place of service of the prepared food. The Meals Tax is based on the locality in which the caterer is subject to the local business license (BPOL) tax. Code of Virginia, §58.1-3841
No, alcoholic and non-alcoholic beverages sold for off-premise consumption in factory sealed containers are exempt from the Meals Tax. Charlottesville City Code §30-284.
Yes. There are several, but the following are the most common types of purchases that are exempt from the Meals Tax:
In addition to the most common ones listed above, the following purchases of food and beverages are exempt from the Meals Tax:
The following items, when served exclusively for off-premise consumption, are exempt from the Meals Tax:
(1) Factory-prepackaged candy, gum, nuts and other items of essentially the same nature.
(2) Pastry, dairy and snack food items, such as doughnuts, ice cream sold in greater than single serving quantities, crackers, nabs, chips, cookies, and the like and items of essentially the same nature.
(3) Food sold in bulk.
(4) Alcoholic and nonalcoholic beverages sold in factory-sealed containers.
(5) Any food or food product purchased with food coupons issued by the United States Department of Agriculture under the Food Stamp Program or drafts issued through the state special supplemental food program for women, infants, and children.
(6) Any food or food product purchased for home consumption as defined in the federal Food Stamp Act of 1977, 7 USC 2012, as amended, except hot food or hot food products ready for immediate consumption. The following items, whether or not purchased for immediate consumption, are excluded from the definition of food in the federal Food Stamp Act: sandwiches, salad bar items sold from a salad bar, prepackaged single-serving salads consisting primarily of an assortment of vegetables, and nonfactory-sealed beverages. Items (3), (4) & (5) are not affected by this item.
The following businesses are not subject to the Meals Tax, except for any portion or section of the business that contains prepared food and beverage operations:
Virginia Retail Sales Tax Exempt Certificate – Customers requesting to make tax exempt purchases must provide you with one of the following…
In addition to the certificate(s), transaction totals must be included as well.
*For employee meals, attach a monthly recap of totals. This can be from Quickbooks or your point-of-sale system.
**When a governmental agency or non-profit organization claims an exemption, the bill must be paid with a check, credit card or purchase order in the name of the agency/organization for the exemption to be approved. If an individual claims an exemption in the name of the agency/organization but pays with cash, a personal check, or their own credit card, the exemption is not valid and will be disallowed.
Retail sales of items like gift cards, hats, t-shirts, bottles of wine, factory sealed beer or distilled spirits should be included in your total gross receipts on the return, but then deducted out. Include a line item accounting of these type of sales and a monthly source recap. For example: HATS - $25.00, GIFT CARDS - $30.00, BOTTLED WINE: $65.00
The Virginia Code, § 58.1-3840, provides the following regarding gratuities:
No such taxes on meals may be imposed on:
(1) The amount paid by the purchaser as a discretionary gratuity; or
(2) That portion of the amount paid by the purchaser as a mandatory gratuity or service charge added by the restaurant in addition to the sales price of the meal, but only to the extent that such mandatory gratuity or service charge does not exceed 20% of the sales price; or
(3) Food and beverages sold through vending machines or on any tangible personal property purchased with food coupons issued by the United States Department of Agriculture under the Food Stamp Program or drafts issued through the Virginia Special Supplemental Food Program for Women, Infants, and Children.