[Adopted 2-18-1998 by Ord. No. 2879; amended in its entirety 7-15-2020 by Res. No. 24-20]
A. 
The following words and phrases, when used in these regulations, shall have the meanings ascribed to them:
ADMINISTRATIVE REVIEW
An administrative process used by the Finance Department to receive and make determinations on petitions from taxpayers relating to the assessment, determination or refund of business privilege tax.
ASSESSMENT
An assessment, determination, settlement or appraisement of tax liability issued by the Township.
AUDIT
An inspection of the books and accounting records of a taxpayer by the Finance Director or his/her authorized agent for the purpose of verifying the correct payment of business privilege taxes by the taxpayer. An audit may be conducted in person at the taxpayer's location, at the Finance Department or by other reasonable means.
AUDITOR
The Finance Director of Upper Darby Township or his/her authorized agent.
BUSINESS TAXES
Business privilege tax or mercantile license tax, collectively, as imposed by the ordinances of the Township.
CREDIT
An overpayment made to the Township for business tax purposes. A credit may be used to satisfy future business privilege tax obligations upon the written request of the taxpayer and the filing of all required tax returns.
DIRECTOR
The Finance Director, his or her assigns, and any other third party involved in the collection of business privilege taxes.
INITIAL INQUIRY
Notice of taxes required to be paid either as a result of a review of tax returns filed no more than three years before the mailing date of the notice or as a result of a determination that the taxpayer failed to file a tax return, underreported income, or failed to pay a tax for one or more of the tax periods covered by in the notice.
JEOPARDY ASSESSMENT
The determination of tax due by the Finance Director based upon previously filed tax returns or other information available to the Director after the taxpayer has failed to file a required tax return or provide additional information as requested by the Finance Department.
TAX REVIEW BOARD
The Finance Committee of Upper Darby Township Council.
TOWNSHIP
Township of Upper Darby unless specified otherwise.
B. 
Other words and phrases may be previously defined within the Upper Darby Township Administrative Code or Ordinances.
The Finance Department shall provide written notice to each taxpayer contacted for an assessment, audit, review, jeopardy assessment or initial inquiry. The notice shall contain the following:
"You are entitled to receive a written explanation of your rights with regard to the audit, appeal, enforcement, refund and collection of local taxes by calling the Upper Darby Township Finance Department at 610-734-7625 during the hours of 8:30 a.m. to 4:30 p.m., Monday through Friday. The Finance Department shall provide a copy of the applicable Upper Darby Township Ordinances and these regulations to any taxpayer that makes a request at no cost."
The Finance Department will notify the taxpayer, in writing, of the basis for any underpayment that the Director has determined to exist, including:
A. 
The tax period, or periods, for which the underpayment is asserted. The amount of the underpayment shall be detailed by tax period.
B. 
The legal basis upon which the Director has relied upon to determine that an underpayment exists.
C. 
An itemization of any revisions made by the Director to a return or report filed by the taxpayer that results in the determination of an underpayment.
The Director is authorized to examine the books and records of any taxpayer in order to verify the accuracy of any return made, or if no return was made, to ascertain whether the tax should be imposed and, if so, the amount of tax due.
The Finance Department shall follow the following procedures during the conduct of an audit or administrative review of a taxpayer's books and records:
A. 
The taxpayer shall be notified in writing of a scheduled audit at least 30 days in advance of the scheduled audit and the written notice shall contain the following information:
(1) 
The tax years subject to audit;
(2) 
The date and time for the audit to be conducted;
(3) 
The place of the audit; and
(4) 
The notice set forth in § 489-24 above.
B. 
The taxpayer may request that the audit be rescheduled, providing that it shall be rescheduled within a reasonable time;
C. 
If the audit is scheduled to be conducted by mail, the taxpayer may request that the audit be conducted in person at the taxpayer's place of business;
D. 
The taxpayer may have a representative present during the audit if it is conducted at the taxpayer's place of business;
E. 
The Director shall send written notice of its findings and conclusions, including the calculation of any tax, interest and/or penalty found to be due or any credit due, to the taxpayer within 30 days after the completion of the audit;
F. 
The Director may request additional information from the taxpayer in order to complete the audit, which information shall be provided to the tax office within 30 days of the request;
G. 
The taxpayer must advise the Director in writing of any dispute or disagreement it has with the audit results within 30 days of the date of the notice from the Director setting forth the audit results;
H. 
The taxpayer will have 30 days from the date of the written notice of tax, interest and/or penalty due to make payment or payment arrangements with the Finance Department;
I. 
The Finance Department will not take any action against the taxpayer for a tax year in question until the end of the audit period, including extensions.
A. 
The Finance Department's Initial request is limited to taxes required to be paid or tax returns required to be filed no more than three years prior to the mailing date of the notice.
B. 
If the Director determines that a taxpayer has failed to file a tax return, under-reported income, or failed to pay for one or more of the tax periods covered by the initial request, the Director may make a subsequent request for a tax return or other supporting information for years beyond the initial three-year inquiry period.
C. 
If a taxpayer has failed to file a required return or pay a tax which was due more than three years prior to the date of a notice, then the three-year period will not apply.
A. 
If the taxpayer has a place of business in the Township and one or more places of business outside the Township, only those receipts properly allocable to the place of business in the Township are taxable. Generally, all of a taxpayer's receipts must be attributable to one of its places of business. Receipts will be considered allocable to the place of business in the Township if any significant aspect of the transaction occurs at or arises out of that place of business.
B. 
The fact that the receipts from any transaction may be subject to tax in a jurisdiction outside the Township does not necessarily mean that those receipts are not allocable to the Township and subject to this tax. The Township will, however, allow a taxpayer to exclude gross receipts attributable to the office in Upper Darby to the extent business privilege tax is paid on those same gross receipts to another municipality if the taxpayer provides a true, correct and complete copy of the tax return for the like tax paid to the other municipality together with proof of payment.
A. 
Apportionment of gross receipts will be made under the following formula:
(total gross receipts x apportionment factor) = gross receipts apportioned to Pennsylvania.
B. 
The apportionment factor shall be the product of averaging the total of the following:
(1) 
Wages, salaries, commissions, and other compensation in Pennsylvania, as a percentage of total wages, salaries, commissions and other compensation.
(a) 
For the purpose of computing the payroll factor other forms of compensation must be included when relevant. Other forms of compensation may include; self-employment income of a proprietor or a single member of a limited liability company, an active partner's share of partnership income, an active member's share of the income of a limited liability company, or an active shareholder's ordinary income from a S corporation.
(2) 
Value of the tangible personal property and real property owned or leased and situated within Pennsylvania as a percentage of total tangible personal and real property owned or leased. The value of leased property is eight times the annual rental, for the purpose of this calculation.
(3) 
Gross receipts from Pennsylvania sales and/or services, as a percentage of total gross receipts from sales and/or services.
(a) 
For taxpayers whose only base of operations is located in the Township, the tax base constitutes gross receipts apportioned to Pennsylvania.
(b) 
For taxpayers with more than one base of operations in Pennsylvania, gross receipts apportioned to Pennsylvania may be further allocated.
The Director may require the taxpayer's federal income tax return if the federal tax information is reasonably necessary for the enforcement or collection of Township taxes and the information is not available from other available sources or the Pennsylvania Department of Revenue.
A. 
Books, journals, invoices, documents and other accounting records utilized by the taxpayer in the ordinary course of business must be kept in a manner which will reflect actual business operations. There must be objective criteria in these books and records, as well as in underlying documents, such as invoices, to support the returns filed by the taxpayer. A taxpayer claiming exemptions or exclusions for any portion of gross receipts must maintain complete records which will support the validity of the claim. Such claims will be disallowed if not sufficiently proven by the taxpayer.
B. 
If records are not available for the entire period requested for review, the Finance Department may utilize whatever information or records are available to reconstruct, as accurately as possible, figures that reflect the business activity of the taxpayer for the period involved.
The Director may enter into written agreements with any taxpayer under which the taxpayer is allowed to satisfy a tax liability in installment payments, if the Finance Department on behalf of the Township determines that the agreement will facilitate collection. An installment agreement may be modified or terminated if the taxpayer provided inaccurate or incomplete information, if the collection of the tax is in jeopardy, if there is a significant change in the taxpayer's financial condition, if the taxpayer fails to provide a financial condition update or fails to pay an installment when due.
A. 
Refund of overpayment. A taxpayer may file a written request with the Finance Department for a refund or credit of any Township business tax within three years of the due date for the tax return, as extended, or one year after actual payment of the tax, whichever is later. For amounts paid as a result of a notice asserting or informing a taxpayer of an underpayment, a written request for a refund shall be filed with the Township Finance Department within one year of the date of the payment.
B. 
Interest on overpayment. All overpayments of tax paid to the Township shall bear simple interest from the date of resolution at the same interest rate as the Commonwealth of Pennsylvania is required to pay pursuant to the Pennsylvania Fiscal Code, except:
(1) 
No interest shall be paid if an overpayment is refunded or applied against any other Township tax, interest or penalty due within 75 days after the due date of a tax return or within 75 days after the actual filing of the tax return, whichever is later; and, no interest shall be paid on overpayments of interest or penalty. Acceptance of a refund check by a taxpayer shall not prejudice the taxpayer from claiming any additional overpayment and interest thereon. The definition of "date of overpayment" and "date of resolution" shall be in accordance with the Taxpayer Bill of Rights.
C. 
Use of credit. A credit balance will be automatically applied against any outstanding tax, including estimates. No refund will be issued if there are any outstanding taxes.
A. 
A request for refund or credit must be filed within three years of the date the filed or due or one year after actual payment, whichever is later.
B. 
A petition for review of a denial of a refund or credit must be filed 30 days after the date of the written denial by the Director.
C. 
A petition for reassessment of any business privilege tax assessment must be filed within 90 days of the date of the assessment notice from the Director.
D. 
Failure to timely file an appeal of an assessment or denial of refund or credit will result in denial of the appeal.
Any taxpayer may request a review of a determination by the Director, including the denial of a refund or credit or tax due using the following procedure:
A. 
Any taxpayer seeking review of a determination by the Director shall file a completed petition for review with the Finance Department for a hearing by the Local Tax Review Board.
B. 
The petition for review shall be on the form provided by the Finance Department and contain the following information:
(1) 
Name and business address of the taxpayer;
(2) 
A complete description of the business activity of the taxpayer which gives rise to the tax or to the claimed refund or adjustment;
(3) 
A copy of the assessment or tax return for which review is sought;
(4) 
The taxpayer's written explanation of the reason that the assessment should be changed or a refund should be given; and
(5) 
Copies of all supporting documentation for the taxpayer's position.
C. 
There shall be no fee charged to the taxpayer for the filing of the petition for review or the hearing on the petition.
D. 
A hearing shall be scheduled by the Chairman of the Tax Review Board. The first hearing on a petition for review shall be held no less than seven days and no more than 30 days after the completed petition has been filed. Subsequent hearings, if required, will be scheduled upon agreement of the Board and the taxpayer.
E. 
Written notice of the hearing shall be given to the taxpayer, Chief Administrative Officer, and the Director. The notice shall state the time, date and place of the hearing.
F. 
A hearing will be conducted by the Tax Review Board in the following manner:
(1) 
The Taxpayer that filed the petition for review of a determination shall present evidence in support of its petition, including documentation and through witnesses;
(2) 
The petitioning taxpayer must prove by clear and convincing evidence their entitlement to a refund or change in assessment;
(3) 
A taxpayer may be represented by an attorney before the Tax Review Board. A corporate taxpayer must be represented by an authorized officer and may have an attorney present;
(4) 
All testimony shall be given under oath;
(5) 
A representative of the Finance Department may question any witnesses presented by the taxpayer.
(6) 
A representative of the taxpayer may question any witness presented by the Finance Department;
(7) 
At the conclusion of the evidence presented by the taxpayer, a representative of the Finance Department may present its evidence in support of the determination appealed from; and
(8) 
The taxpayer at its sole expense may provide for stenographic recordation of the hearing before the Tax Review Board.
G. 
The Tax Review Board's decision will be sent to the taxpayer, in writing, within 60 days of the receipt of the completed petition for review. The taxpayer may execute a waiver of time to allow the presentation of additional evidence by the taxpayer or at the Review Board's request to allow it additional time to render a decision.
H. 
The taxpayer may appeal the determination of the Tax Review Board to the Court of Common Pleas of Delaware County within 30 days of the date of the determination of the Tax Review Board.
I. 
No administrative review or judicial appeal will operate to suspend the accrual of penalty and interest from the date the tax was due to the date that the tax is actually paid.
The Finance Department shall follow the enforcement procedures set forth in the Administrative Code and/or Township Ordinances and may bring legal action for the collection of taxes, penalty and interest as follows:
A. 
Civil complaint: The Finance Department may file a civil complaint in District Court or the Court of Common Pleas for all past and current taxes due plus penalty and interest.
B. 
Fees and costs: In all legal actions, the Township will seek to recover court costs and attorney fees.