[Adopted 12-27-2007 by Ord. No. 2007-FF[1]]
[1]
Editor's Note: This ordinance also repealed
former Art. IV, Emergency and Municipal Services Tax, adopted 12-19-2005
by Ord. No. 2005-L.
This article shall be known and may be cited
as the "Township of Conewago Local Services Tax Ordinance."
This article is enacted under the authority
of the Local Tax Enabling Act, as amended by Act No. 7 of 2007.[1]
[1]
Editor's Note: See 53 P.S. § 6901
et seq. and 53 P.S. § 6924.101 et seq.
The purpose of this article it to provide revenue
for police, fire and emergency services; road construction and maintenance;
the reduction of property taxes and for such other purposes as may
be specified for such tax from time to time by the laws of the Commonwealth
of Pennsylvania.
The following words and phrases, when used in
this article, shall have the meanings ascribed to them in this section
except where the context clearly indicates or requires a different
meaning:
The governing body of the Township of Conewago.
The person or firm, from time to time, designated by motion
of the Board of Supervisors of the Township of Conewago to collect
and administer the provision of this article and collect the tax levied
by this article. Until changed by subsequent motion, the Collector
shall be the same person or firm last designated to collect the emergency
and municipal services tax for the Township of Conewago.
The aggregate annual rate of the local services tax levied
by a school district and the Township of Conewago located in whole
or in part within the school district.
"Compensation" as determined under Section 303 of the Act
of March 4, 1971 (P.L. 6, No. 2), known as the "Tax Reform Code of
1971,"[1] and regulations in 61 Pa. Code Part I, Subpart B, Article V (relating to personal income tax), not including, however, wages or compensation paid to individuals on active military service. Employee business expenses are allowable deductions as determined under Article III of the "Tax Reform Code of 1971." Any housing allowance provided to a member of the clergy shall not be taxable as earned income.
An individual, partnership, association, corporation, governmental
body, agency or other entity employing one or more persons on a salary,
wage, commission, fee or other compensation basis, including a self-employed
person.
Shall include singular and plural number and male, female
and neuter gender.
Any person engaged in any occupation, trade or profession
within the jurisdictional limits of the Township of Conewago whose
total earned income and net profits within the Township of Conewago
are greater than $12,000 per calendar year.
The net income from the operation of a business, profession,
or other activity, (except from corporations), determined under Section
303 of the Act of March 4, 1971 (P.L. 6, No. 2), known as the "Tax
Reform Code of 1971,"[2] and regulations in 61 Pa. Code Part I, Subpart B, Article V (relating to personal income tax). The term does not include income which is not paid for services provided and which is in the nature of earnings from an investment. For taxpayers engaged in the business, profession or activity of farming, the term shall not include:
Any interest generated from monetary accounts
or investment instruments of the farming business;
Any gain on the sale of farming machinery;
Any gain on the sale of livestock held twelve
months or more for draft, breeding or dairy purposes; and
Any gain on the sale of other capital assets
of the farm.
Any trade, profession, business or undertaking of any type,
kind or character including services, domestic or other, carried on
or performed within the jurisdictional limits of the Township of Conewago
for which compensation is charged and/or received, whether by salary,
wages, commissions, fees or net profits, for services rendered.
The United States Army Reserve, United States Navy Reserve,
United States Marine Corps Reserve, United States Coast Guard Reserve,
United States Air Force Reserve, the Pennsylvania Army National Guard
or the Pennsylvania Air Guard.
The local services tax levied in this article.
A calendar year.
The Township of Conewago hereby levies and imposes
on every individual engaging in an occupation within the jurisdictional
limits of the Township of Conewago a tax in the amount of $52 per
annum, beginning the first day of January 2008 and continuing on a
calendar basis annually thereafter, until modified or repealed by
subsequent ordinance. This tax is in addition to all other taxes of
any kind or nature heretofore levied by the Township of Conewago.
The Township of Conewago shall use the revenue
derived from this tax for the following purposes; provided, however,
that no less than 25% of the funds derived from this tax shall be
used for emergency services, as defined herein:
A.
Emergency services, which shall include emergency
medical services, police services and/or fire services.
B.
Road construction and/or maintenance.
C.
Reduction of property taxes.
A.
Each employer with the Township of Conewago and each
employer situate outside the Township of Conewago who engages in business
with the Township of Conewago is hereby charged with the duty of collecting
the tax from each of the employees engaged by the employer and performing
work for the employer within the Township of Conewago. Each person
subject to the tax shall be assessed a pro rata share of the tax for
each payroll period in which the person is engaging in an occupation.
B.
The pro rate share of the tax assessed on the person
for a payroll period shall be determined by dividing the combined
rate of the local services tax levied for the calendar year by the
number of payroll periods established by the employer for the calendar
year. For purposes of determining the pro rata share, an employer
shall round down the amount of the tax collected each payroll period
to the nearest one-hundredth of a dollar.
C.
Employer collection of the local services tax shall
be made on a payroll period basis for each payroll period, beginning
with the first payroll period in which the person is engaging in an
occupation.
D.
No employer shall be held liable for failure to withhold
the local services tax or for payment of the withheld tax money to
the Township of Conewago if the failure to withhold taxes arises from
incorrect information submitted by the employee as to the employee's
place or places of employment, the employee's principal office or
where the employee is principally employed.
Employers are required to make and file a local
services tax quarterly return 30 days after the end of each quarter
of a calendar year. The local services tax quarterly return shall
list the name, address, social security number of the employee; the
physical address of the employee's place of employment; the number
of payroll periods for which the local services tax was withheld;
and the amount of local services tax being remitted for each employee.
Each employer shall use his employment and payroll
records from the first day of January to March 31 each year for determining
the number of employees from whom said tax shall be deducted and paid
over to the Collector on or before April 30 of the same calendar year.
Supplemental reports shall be made by each employer on July 30, October
30 and January 31 for new employees as reflected on his employment
and payroll records from April 1 to June 30, July 1 to September 30
and October 1 to December 31, and payments on these supplemental reports
shall be made on July 30, October 30 and January 30, respectively.
A.
In the event a person is engaged in more than one
occupation, that is, concurrent employment, or an occupation which
requires the person working in more than one political subdivision
during the payroll period, the priority of claim to collect the local
services tax shall be in the following order:
(1)
The political subdivision in which a person maintains
his or her principal office or is principally employed.
(2)
The political subdivision in which the person resides
and works, if the tax is levied by that political subdivision.
(3)
The political subdivision in which a person is employed
and which imposes the tax nearest in miles to the person's home.
B.
In the case of concurrent employment, an employer
shall refrain from withholding the local services tax, if the employee
provides:
(1)
A recent statement from a principal employer that
includes the name of the employer, the length of the payroll period
and the amount of local services tax withheld; and
(2)
A statement from the employee that the pay statement
is from the employee's principal employer and the employee will notify
other employers of a change in principal place of employment within
two weeks of its occurrence.
C.
The situs of the tax shall be the place of employment
on the first day the person becomes subject to the tax during each
payroll period. It is the intent of this section that no person shall
be subject to the payment of the local services tax by more than one
political subdivision during each payroll period.
A.
The local services tax shall be no more than $52 on
each person for each calendar year, irrespective of the number of
political subdivisions within which a person may be employed.
B.
The Local Tax Enabling Act,[1] as amended, required municipalities and school districts
which levy the local services tax at a combined rate exceeding $10
to exempt any person from the local services tax whose total earned
income and net profits from all sources within the Township of Conewago
is less than $12,000 for the calendar year in which the local services
tax is levied. Each political subdivision levying the local services
tax hereby exempts the following persons from the local services tax:
(1)
Any person whose total earned income and net profits
from all sources within the Township of Conewago is less than $12,000
for the calendar year in which the local services tax is levied.
(2)
Any person who served in any war or armed conflict
in which the United States was engaged and is honorably discharged
or released under honorable circumstances from active service if,
as a result of military service, the person is blind, paraplegic or
a double or quadruple amputee or has a service-connected disability
declared by the United States Veterans' Administration or its successor
to be a total one-hundred-percent permanent disability.
(3)
Any person who serves as a member of a reserve component
of the armed forces and is called to active duty at any time during
the taxable year. A "reserve component of the armed forces" shall
mean the United States Army Reserve, United States Navy Reserve, United
States Marine Corps Reserve, United States Coast Guard Reserve, United
States Air Force Reserve, the Pennsylvania Army National Guard or
the Pennsylvania Air National Guard.
[1]
Editor's Note: See 53 P.S. § 6901 et seq. and 53
P.S. § 6924.101 et seq.
C.
A person seeking to claim an exemption from the local
services tax must annually file an exemption certificate with the
Collector of the tax for the political subdivision levying the tax
and file a copy of the certificate with the person's employer affirming
that the person reasonably expects to receive earned income and net
profits from all sources within the Township of Conewago of less than
$12,000 in the calendar year for which the exemption certificate is
filed. The exemption certificate shall have attached to it a copy
of all of the employee's last pay stubs or W-2 forms from employment
within the Township of Conewago for the year prior to the fiscal year
for which the employee is requesting to be exempted from the local
services tax.
D.
Upon receipt of the exemption certificate and until
otherwise instructed by the Collector of the tax for the Township
of Conewago, the employer shall not withhold the tax from the person
during the calendar year or remainder of the calendar year for which
the exemption certificate applies. With respect to a person who claimed
an exemption from the local services tax, upon notification to an
employer by the person or by the Collector of the tax for the Township
of Conewago that the person has received earned income and net profits
from all sources within that Township of Conewago equal to or in excess
of $12,000 in that calendar year or that the person is otherwise ineligible
for the tax exemption for that calendar year, or upon an employer's
payment to the person of earned income within that Township of Conewago
in an amount equal to or in excess of $12,000 in that calendar year,
an employer shall withhold the local services tax from the person
as follows:
(1)
If a person who claimed an exemption for a given calendar
year from the local services tax becomes subject to the tax for the
calendar year, the employer shall withhold the tax for the remainder
of that calendar year.
(2)
The employer shall withhold from the person, for the
first payroll period after receipt of the notification under the above
subsection, a lump sum equal to the amount of the tax that was not
withheld from the person due to the exemption certificate filed by
the person, plus the per-payroll amount due for that first payroll
period.
(3)
The amount of tax withheld per payroll period for
the remaining payroll periods in that calendar year shall be the same
amount withheld for other employees.
E.
In the event the employment of a person subject to
withholding of the local services tax under this exception is severed
in that calendar year, the person shall be liable for any outstanding
balance of tax due, and the Township of Conewago may pursue collection
under this act.
F.
Except as provided for in Subsection D above, Employers shall not be responsible for investigating exemption certificates, monitoring tax exemption eligibility or exempting any employee from a local services tax.
G.
Employers shall be responsible for retaining a copy
of all exemption certificates filed by employees within a given calendar
year for a minimum of three years. Employers who have failed to withhold
the local services tax from an employee or employees and do not have
copies of the employee exemption certificate or certificates will
be held responsible for the payment of the local services tax as if
the tax had been originally levied against the employer.
All self-employed individuals and individuals
whose employer is not required to withhold local taxes (certain state
and federal agencies) will be billed quarterly for the local services
tax. The full amount of tax must be paid by the date indicated on
such billing. If such taxpayer qualifies for a low-income exemption,
the taxpayer may complete the required exemption certificate or make
application for a refund of the tax paid.
All employers and self-employed individuals
residing or having their place of business outside the Township of
Conewago but who engage in any occupation within the Township of Conewago
do, by virtue thereof, agree to be bound by and subject themselves
to the provisions, penalties and regulations promulgated under this
article with the same force and effect as though they were residents
of the Township of Conewago. Further, any individual engaged in an
occupation within the Township of Conewago and an employee of a nonresident
employer may, for the purpose of this article be considered a self-employed
person, and in the event this tax is not paid, the Collector shall
have the option of proceeding against either the employer or employee
for collection of this tax as hereinafter provided.
A.
It shall be the duty of the Collector to accept and
receive payments of this tax and keep a record thereof showing the
amount received by him from each employer or self-employed person,
together with the date the tax was received. It shall be the duty
of the Collector to accept and keep a record of the information submitted
by employers relating to the number of employees subject to the tax,
the number of employees exempt from the tax, the employee exemption
certificates and refunds of the tax paid to individuals and employers.
It further shall be the duty of the Collector, on behalf of the Township
of Conewago, to provide a taxpayer a receipt of payment upon written
request of the taxpayer.
B.
The Collector is hereby charged with the administration
and enforcement of this article and is hereby empowered to prescribe,
adopt, promulgate and enforce rules and regulations relating to any
matter pertaining to the administration and enforcement of this article,
including provisions for the examination of the payroll records of
any employer subject to this article; the examination and correction
of any return made in compliance with this article; and any payment
alleged or found to be incorrect or as to which overpayment is claimed
or found to have occurred. Any person aggrieved by any decision of
the Collector shall have the right to appeal to the Court of Common
Pleas of Adams County as in other cases provided.
C.
The Collector is hereby authorized to examine the
books and payroll records of any employer in order to verify the accuracy
of any return made by an employer or, if no return was made, to ascertain
the tax due. Each employer is hereby directed and required to give
the Collector the means, facilities and opportunity for such examination.
A.
In the event any of the tax under this article remains
due or unpaid 30 days after the due date set forth above, the Collector
may sue for the recovery of such tax due or unpaid, together with
interest and penalty.
B.
If for any reason the tax is not paid when due, interest
at the rate of 6% per annum on the amount of said tax, and an additional
penalty of 10%, shall be added to the flat rate of said tax for nonpayment
thereof. Where suit is brought for recovery of this tax, the individual
liable therefor shall, in addition, be responsible and liable for
the costs of collection, including, but not limited to, attorneys'
fees.
Whoever makes any false or untrue statement
on any return required by this article or who refuses inspection of
his books, records or accounts in his custody and control in order
to determine the number of employees subject to this tax who are in
his employment or who fails or refuses to file any return required
by this article or fails or refuses to pay the tax herein levied shall,
upon conviction, be sentenced to pay a fine of not more than $600.00
plus costs and, in default of payment of said fine and costs, be sentenced
to a term of imprisonment not to exceed 30 days. It is further provided
that the action to enforce the fine and penalty herein provided may
be instituted against any person in charge of the business of any
employer who has failed or refused to file a return required by this
article.
Refunds are to be paid within 75 days of a refund
request or 75 days after the last day the employer is required to
remit the local services tax for the last quarter of the calendar
year, under Section 9 of Act 7, whichever is later, and shall not
be subject to interest if paid within the allowed time. Refunds shall
only be provided for amounts overpaid in a calendar year that $1.
A.
Refund due to duplication of payment. If at any time
during the calendar year a taxpayer pays more than $52 in combined
local services tax, the taxpayer may apply for a refund of the amount
over $52. The proper refund request form must be completed and signed
by the taxpayer, and necessary documentation must be included. These
refunds may be processed at the time they are received, unless there
is reason to believe the Township of Conewago will not receive the
tax from the employer.
B.
When an individual's "earned income and net profits,"
only, for the calendar year is less than the exemption of $12,000
at the end of the calendar year, any taxpayer who qualifies may complete
a refund application and include a copy of the necessary documentation.
This article shall become effective in accordance
with applicable law, with the repeal of the previous Occupational
Privilege Tax and Emergency and Municipal Services Tax Ordinance,
effective January 1, 2008.
