Obtaining a PCardTax Exception for purchases for Intangible items such as software, subscriptions, services, conferences, images, etc

Explanation:

PCS PCard Policy only allows the use of the University PCard to purchase Tangible items from foreign vendors for items such as goods, supplies, or equipment.  But it prohibits the purchase of intangibles from foreign vendors such as software subscriptions, equipment installation, conferences, or training. Because the Bank that issued the PCard is only required to tax report purchases from U.S. vendors. The University remains responsible for tax reportable purchases fromo non-U.S. vendors. 

Procedure:

Business Affairs (BA) has created a Request for a PCard Tax Exception procedure. Once the PCard Tax Exception has been approved, this allows departments the freedom to make intangible purchases foreign entities while allowing the University to remain compliant with applicable federal tax regulations.This is a Special One-time-only PCard PCard exception for each separate purchase from foeign entities for software, membership access to databases, images, database access, subscripitons, services, and that includes any purchases that will not be shipped to the University. 

Steps:

The PCard Tax exception is obtained from Business Affairs Tax Services via an emailed request to jgermack@uoregon.edu. It is a one time only exception for one purchase or if the request is for monthly payments is only applicable on a calendar year basis. Because tax reporting is on a calendar year basis, the PCard tax exception will only be valid between January 1st and December 31st of any one calendear year.

• The email subject line contains 'PCard Tax exception request" & Vendor's name and UO ID number in the Subject line. 
• The PCard

In addition to the subject line:

• the vendor's name and UO ID number, 
• the amount in USD and date of the purchase (or a estimated date range), the exact U.S.Dollar amount is required.
• the Last four digits of the card 
• Required- attach a copy of the P.O., PSC, invoice, or order form. 
• Note: Grossed up federal taxes of 42.857% may apply requiring an index to charge.
• Provide an index to charge for the federal taxes.

If the  foregin vendor does not have a Banner Vendor ID number

1. The vendor is required to have a UO Vendor Number.  
2. When the foreign vendor is not yet set up in Banner A/P, the department must obtain a W-8 form from them or their website, and set them up per Accounts Payable procedures. See new Vendor-setup secure transmission of W-9/8 forms
3. AFTER they have a Vendor Number, send an email to jgermack@uoregon.edu  with  the email subject line "Request for PCard Tax Exception -vendor's name and Vendor ID Number".

Foreign Vendor's W-8 Form does not include a formal Request for Treaty Benefits

1. If it is determined there is applicable taxes on the purchase, your department will be required to provide an index to charge for the taxes. 
2. There is no way to withhold federal taxes from a PCard purchase.
3. The grossed-up tax rate is 42.857%. (.30/(1-.30))
4. A Banner JV will be created by Tax Services to charge the expense to the purchasing department's index.  
5. If the department is unable to obtain a W-8 form, for any reason, an exception request will require, in addition to the other information, a pdf attachment of your department's email sent to the vendor requesting their W-8 form, their full name and a physical address, and an index to charge for the 42.857% grossed-up tax, if it is applicable.

After PCard Tax Exception approval is obtained from Tax Services

1. Once approved: a PCard Foreign Vendor Intangible Exception Request Approval will be emailed back to you.   
2. You may then make the purchase with your PCard. 
3. The exception is required to be uploaded to Concur attached to the expense line in question as an additional receipt .pdf image.  
4. Note: this approval is a one-time purchase only exception, specific to vendor, specific to the date, and specific to amount of the purchase.  Any other purchases from the same vendor will require additional exception requests.