What Texas Form 01-117 (2016) Is For
Texas Form 01-117 is a shorter version of the Texas Sales and Use Tax Return. It is used by businesses that are eligible to report and pay state and local sales and use tax. It is designed for individuals with permits who need to report simple matters, typically related to a single business location.
This tax return is used to report retail sales, taxable services, and taxable purchases subject to use tax. It records total sales, taxable sales, and taxable items purchased without paying sales tax at the time of purchase.
The Texas Comptroller administers the form through the Comptroller’s Office and applies to 2016 reporting periods. Businesses must file this tax return to remain compliant with Texas sales and use tax requirements, even when no tax is due.
When You’d Use Texas Form 01-117
Texas Form 01-117 is for individuals who hold a sales tax permit and are required to file the short-form Texas Sales and Use Tax Return. It works well for businesses that only have to report sales to one local taxing authority and have simple allocation needs.
Permit holders are required to file returns for every reporting period assigned by the Texas Comptroller. Filing deadlines typically fall on the 20th day of the month following the end of the reporting period, depending on the frequency of filing.
This form is also used for late filing or amended filing. Late filing may result in penalties and interest, while an amended return allows correction of errors, reporting additional tax, or requesting a refund claim.
Key Rules or Details for 2016
Regardless of the business activity, Texas law requires all holders of sales tax permits to file returns for each reporting period. Even if no tax payment is due, a late-filing penalty applies for failing to file by the deadline.
Businesses that paid $50,000 or more in sales tax in the last state fiscal year must file electronically. Larger taxpayers must also pay their taxes online using approved systems, such as Webfile or TEXNET.
The Texas Sales and Use Tax Return must include a section on use tax reporting. Businesses must pay use tax on taxable goods or services they purchase without paying sales tax, even if they are bought from another state or online.
Step-by-Step (High Level)
Step 1: Gather records and verify filer details
For the time period, gather invoices, receipts, and proof of exemption or resale. Check the business name, EIN, permit number, and reporting period on Form 01-117.
Step 2: Calculate total and taxable sales
Determine the total retail sales for the reporting period and distinguish between taxable and exempt transactions. If you have any questions later, keep the exemption support handy.
Step 3: Apply sales tax rates and compute sales tax due
For taxable sales, add the appropriate local tax and the state rate. Verify that rates correspond to the return's location rules.
Step 4: Calculate use tax on untaxed purchases
After finding taxable items that were purchased without sales tax, figure out how much use tax is owed. Add the sales tax and the use tax together to get the total tax before any discounts.
Step 5: Apply discounts, file, and pay
Use any available discounts, then complete the payment and return the item by the specified deadline using the designated method. People who file on paper may need Adobe Reader to open PDFs, but people who file online use the Comptroller's Webfile system.
Common Mistakes and How to Avoid Them
- Skipping zero-sales filings: Submit a zero-dollar return for every reporting period to avoid automatic penalties and compliance notices.
- Using the incorrect tax rate: Verify the combined state and local rate for the location and filing period to ensure the return does not underpay or overpay tax.
- Ignoring use tax on out-of-state purchases: Review expense records for taxable items bought without sales tax and report use tax to reduce audit exposure.
- Claiming exempt sales without valid certificates: Collect and retain properly completed exemption certificates to prevent tax liability from shifting back to the business during an audit.
- Miscalculating filing discounts: Follow the Comptroller's discount rules and apply the discount correctly before payment, ensuring the tax due and remittance match.
What Happens After You File
After filing Texas Form 01-117, the return is processed by the Texas Comptroller, who also updates the taxpayer's account. Paper submissions typically take longer to post than electronic filings.
If an overpayment happens, businesses can apply the credit to a later tax return or submit a refund claim. The documentation and verification requirements determine the processing time for refunds.
Permit revocation or further enforcement actions may follow noncompliance with audit requests, tax payment obligations, or filing returns.
FAQs
Who must file Texas Form 01-117?
Any retail business holding a sales tax permit and assigned short-form filing status by the Texas Comptroller must file this form for each reporting period.
Can Texas Form 01-117 be filed as an amended return?
Yes, businesses may file an amended return to correct errors, report additional tax due, or request a refund claim for overpaid tax.
What if a business sells taxable services and taxable goods?
Taxable goods and services must be reported using the proper reporting lines on the same Texas Sales and Use Tax Return.
Is a resale certificate required for exempt sales?
Yes, to substantiate tax exemption claims during audits, sellers must obtain and maintain a current resale or exemption certificate.
How does use tax differ from sales tax?
Sales tax is collected from customers at the time of sale, while use tax is owed by the purchaser when sales tax was not collected.
What forms are related to Texas Form 01-117?
Related tax forms include Form 01-114, Form 01-148, and the Credit and Customer Broker Schedule, depending on reporting needs.
Where should questions about this form be directed?
Questions about this form should be directed to the Texas Comptroller through official sales and use tax support resources.
