Are Golf Courses Collecting Unnecessary Sales Tax?

The Missouri Director of Revenue and PF Golf, LLC took a case to the Supreme Court of Missouri regarding sales tax on the “mandatory” rental of golf carts in March of 2013.  The Director of Revenue issued an assessment of more than $100,000 in unpaid sales tax.  The outcome of the case was finalized in July 2013, with PF Golf, LLC chalking up the win.

Missouri golf courses are NOT required to collect and remit sales tax on the rental of golf carts, if tax was paid on the purchase of the carts.  Additionally, even though golf fees and cart rentals are priced together, the customers’ receipts must separately itemize the greens fees and the cart rental fees.  The greens fees are subject to sales tax, while the cart rental fees could be exempt from sales tax.  Implementing a good point of sale system with services and products properly coded as “taxable” or “exempt” is crucial to a smooth operation at any golf course.

If you have any questions related to a sales tax issue at your golf course, please contact your Anders tax advisor.