Indirect Tax Solutions
Vertex Indirect Tax for Hospitality
®
Open the Door for Complete Hospitality Tax Management.
The ins and outs of the hospitality industry are complex, and it’s challenging to ensure quality customer experiences, as well
as accurate internal business practices. Vertex understands the nuances and details of hospitality taxes, like how the number
of nights impacts a lodging transaction’s taxability status and how a food sale occurring in a convenience store has a different
tax rate than one in a restaurant, and we have the solution. Vertex Indirect Tax for Hospitality can manage even your most
complicated tax scenarios — minimizing the margin for risk surrounding hospitality tax calculation and compliance.
Welcome to Hospitality Tax Automation
It has never been a more difficult time to operate a hospitality
So whether you’re a five star restaurant, national hotel, or online
business. This is true for both the traditional brick and mortar
travel agency, Vertex can automate your tax process and reduce the
businesses, like hotels and restaurants, as well as online companies
risk of inaccurate returns. Allowing you to focus on your guests, not
like travel marketplaces. Vertex Indirect Tax for Hospitality leverages
the taxes associated with them.
the industry-leading Vertex ® Indirect Tax O Series® tax engine along
with our calculation and returns offerings, to provide accurate and
reliable ways to effectively manage the most complicated areas of
hospitality tax.
All-Inclusive Hospitality Tax Management
By leveraging Vertex O Series in tandem with one of our hospitality focused returns solutions, Vertex can offer a complete, end-to-end solution
to anyone in the hospitality industry.
VERTEX INDIRECT TAX FOR HOSPITALITY
An end-to-end tax management solution for the entire hospitality industry.
Sales & Use Tax
Hotels
Lodging Tax
Hotels
Food & Beverage Tax
Hotels
Restaurant
Travel Agents
Travel Agents
Restaurants
Returns Software Offerings and Managed Services: Sales & Use Tax Returns, Food & Beverage Returns, Returns Outsourcing
Indirect Tax Solutions
2
Vertex Indirect Tax for Hospitality
®
Multi-Faceted Tax Calculation
Lodging
Food & Beverage
Vertex® Indirect Tax O Series® is the industry’s first and only lodging
In addition to sales tax, and lodging and occupancy tax, Vertex O Series
solution to centralize all U.S. lodging and occupancy tax data in a
contains a powerful and robust calculation engine capable of
single enterprise tax management platform.
handling complex food and beverage tax scenarios. There are
It’s now possible to automatically calculate:
numerous rules governing how much tax is applied, when tax is
•Hotel Occupancy Taxes and Fees for every unique jurisdiction
in U.S.
for the transaction based on any unique qualifying conditions. At a
applied, as well as whether or not there are any special exemptions
high level, some of the key drivers that the Vertex solution uses to
•State, County, City and District sales taxes
manage the application of rates and rules include:
•Taxation of hotel imposed fees, such as resort fees
•What type of facility is selling the food? (i.e., Grocery Store,
Restaurant, Convenience Store)
•Exemptions based on permanent resident or other individual
customer characteristic
Our Lodging solution calculates lodging taxes and sales and use taxes,
all on the same platform. For example, take the following scenario.
Tax Percent
Tax Amount
State Sales Tax
4.00%
$
4.00
City Sales Tax
4.50%
$
4.50
1.50/day
$
5.875%
$
2.00/day
0.375
City Hotel Unit Fee
City Hotel Room Occupancy Tax
District Sales Tax
1.50
$
City Hotel Room Occupancy Tax
$
Total Tax
•Are utensils provided by the seller?
•Is there on-premise seating?
•Is the food hot or cold?
One Night Stay in New York City at $100/Night
Tax Type
•Is the food meant to be consumed immediately or at home?
An example tax scenario, illustrating some of the underlying complexities
surrounding food and beverage tax is shown below:
Scenario 1: Grocery Store in Martinsville, Virginia selling pizza for
consumption off premises for $10.00
5.88
Tax Type
Tax Percent
$
2.00
State Tax
1.5%
$
$
0.38
County Tax
0%
$
City Tax
1%
$
18.25
$
Total Tax
Although this is a relatively simple scenario, it shows the breadth
of information that the system can manage, including both flat fees
and percent based rates. Keep in mind, that this isn’t just rates and
rules. There is a significant amount of business logic built into the
Tax Amount
$
0.00
Scenario 2: Grocery Store in Martinsville, Virginia selling pizza for
consumption on premises for $10.00
Tax Percent
for a hotel stay, including:
State Tax
4.3%
$
•Applying or not applying tax depending on the number of rooms
available in a given hotel/lodging establishment
County Tax
0%
$
City Tax
1%
$
•Applying different tax rates depending on the number of rooms
available in a given hotel/lodging establishment
City Tax (Meal Tax)
6.5%
$
Total Tax
$
•Total days staying in a specific hotel/lodging establishment can
impact residency status, and immediately impact occupancy tax
0.10
0.25
Tax Type
solution that assists in effectively calculating the total tax burden
0.15
Tax Amount
0.43
0.00
0.10
0.65
1.18
The simple act of selling the pizza for consumption on premise caused
a tax delta of $.93. This example is simple, but illustrates how the
same organization can sell the same food, and a very subtle factor
can have a huge tax impact. Vertex is capable of taking into account
all of the subtleties which can impact establishments that have food
& beverage services to ensure that minor tax nuances don’t have major
detriments to the proper taxation of a business.
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Indirect Tax Solutions
Vertex Indirect Tax for Hospitality
®
Continued Compliance with Versatile Tax Returns Offerings
Accurately calculating hospitality taxes is only part of the process. Effectively remitting taxes to various state and local authorities is also
a huge task, and one that must be done correctly and promptly. Vertex also offers a full suite of returns solutions to manage difficult compliance
requirements and many other business needs.
Returns Software
Vertex Indirect Tax Returns
®
The manual processing of sales and use tax returns is a labor-intensive
effort that can strain the resources of your tax department. Hundreds
of different forms, thousands of constantly changing rates, and tens
About Vertex
Founded in 1978, Vertex Inc. is the leading provider of corporate
tax software and services for companies of all sizes, from small
to medium-sized businesses to global multinationals.
of thousands of jurisdictions make sales and use tax compliance a
Vertex solutions enable companies to realize the full strategic
complex challenge. Vertex Returns is a simple to install software that
potential of the corporate tax function. The company offers
automatically produces signature-ready state and local returns.
a variety of products and services that allow businesses to
Vertex Returns is designed to:
•Supply accurate and timely tax rate, return, and regulatory data
•Produce food and beverage tax returns
automate, integrate, and streamline their corporate tax
processes. Vertex provides solutions in every major line of
tax including income, sales and consumer use, value added
and payroll. Vertex also offers tailored solutions for specific
•Support traditional and electronic (eFile) returns filing
industries including retail, communications, hospitality
•Create electronic return data files for user upload to
jurisdictional websites and automated eFile transmission to
compatible states
and leasing. Vertex Managed Services allows companies to
outsource sales and use tax returns and exemption certificate
management.
•Generate paper and electronic payment requests with full
general ledger coding
•Create reports with valuable management information
•Maintain a clear, detailed audit trail
•Permit archiving and retrieval of all filings
•Free up time to dedicate to more high-value responsibilities
Returns Outsourcing
If your hospitality business would benefit from a
powerful, customized, end-to-end tax management
solution, please contact Vertex at 800.355.3500 or
visit vertexinc.com.
Software to manage your returns is not the only option. You can also
choose to outsource the entire returns process to Vertex® Sales & Use
Tax Returns Outsourcing, so your tax staff can focus on more
value-add work. This trusted and comprehensive solution handles
everything – from returns preparation and filing to payments and
notice resolution. And all data, documents, and communication is
accessible 24/7 on the online client portal for complete transparency
and control.
Vertex Global Headquarters
1041 Old Cassatt Road
Berwyn, PA 19312
United States
Phone: 610.640.4200
Toll-free: 800.355.3500
Fax: 610.640.5892
Vertex Global Tax Solutions LTD
1 Furzeground Way, Stockley Park
Uxbridge UB11 1EZ
United Kingdom
Phone: +44 (0) 208 622 3053
Fax: +44 (0) 208 622 3200
Vertex Global Tax Solutions Brasil Ltda.
Av. Dr. Chucri Zaidan, 940
16° andar – Market Place Tower II
04583-906 – São Paulo – Brazil
Phone: +55 11 5095.3433
Reg. in England and Wales. Reg. No. 5982877
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of Vertex Inc. All other trademarks are used for identification purposes only and are properties of their respective owners. 07.15