LOCAL SERVICES TAX
(LST)
OCCUPATION PRIVILEGE
TAX (OPT)
Act 7 of 2007
Amending Act 511 of 1965
LOCAL
SERVICES TAX – RICHLAND TOWNSHIP ($47.00):
Effective January 1, 2008 the Local Services Tax (LST)
replaces the Emergency & Municipal Services Tax (EMST). The LST is assessed on each person employed
within the political subdivision levying the tax. The information contained in these Rules
& Regulations are based on the interpretation by the PA. Department
of Community & Economic Development (DCED).
OCCUPATION
PRIVILEGE TAX –
For 2008 the
EMPLOYER
WITHHOLDING – DUTIES OF EMPLOYER:
A
person subject to the LST/OPT in excess of $10.00 shall be assessed a pro rata
share of the tax for each payroll period in which the person is engaging in an
occupation within Richland Township/School District.
To
determine the pro rata share of the tax to be withheld, divide the combined
rate of the LST levied for the calendar year by the number of payroll periods
established by the employer for the calendar year. An employer is required to round down the
amount of tax collected each payroll period to the nearest one-hundredth of a
dollar.
Employer
collection of the LST shall be made on a payroll period basis beginning with
the first payroll period in which the person engages in an occupation within
Richland Township/School District.
EMPLOYER
REMITTANCE OF COLLECTED TAX & REPORTING OF COLLECTION DETAIL:
Employers
are required to remit the LST withheld from their employees and file the
required Quarterly LST return Thirty (30) days after end close of each
quarter. The LST return shall list name,
address, social security number, physical address of the place of employment, and
the amount being remitted per employee per quarter, and the total tax withheld
for all employees.
SELF-EMPLOYED
INDIVIDUALS
Self-employed
individuals and individuals whose employer is not required to withhold local taxes
for the LST shall pay quarterly. 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 application for a refund of
tax paid.
EXEMPTION
OF THE LOCAL SERVICES TAX:
The
law required municipalities who levy the LST at a rate exceeding $10.00 to
exempt any person whose total earned income and or net profits from all sources
within Richland Township is less than $12,000 for the calendar year
in which the LST is levied.
Since
Richland Township is located within Richland School District and the School
District levies an Occupation Privilege Tax OPT in the amount of $5.00, the exemption
criteria that pertains to the LST does not apply to the OPT and the entire
amount of $5.00 for the OPT must me deducted in one lump sum.
An
annual upfront exemption certificate, supplied by the employer, must be
completed by the employee and submitted to the employer and to the Special Tax
Office. The DECD has developed a
standardized exemption certificate. A
copy of the exemption certificate is located on this web page www.richlandtwp.com and may also be obtained at www.newPA.com. Upon receipt of the exemption certificate
from the employee the employer shall not withhold the tax from the employee
during the calendar year or remainder of the calendar year for which the
exemption certificate applies. The
exemption certificate must have attached to either the employee’s W-2 forms or
copies of the employee’s last pay stub for the prior year.
Should
any person who received an exemption from the LST in the current year become
subject to the tax under the following circumstances:
1)
Upon
notice to the employer by the employee or the Township that he/she received
income of at least $12,000 in that calendar year within
the municipality or….
2: The employer has paid the employee at least
$12,000 in that calendar year.
Under
any of these circumstances, an employer shall withhold the LST from the person
for the first payroll period after receipt of notification or payment of a
least $12,000, a lump sum equal to the amount of tax that would be due from the
beginning of employment in the calendar year, plus the payroll amount due for
that first payroll period.
Under
any of these circumstances, an employer shall withhold the LST from the person
for the first payroll period after receipt of notification or payment of at
least $12,000, a lump sum equal to the amount of tax that would be due from the
beginning of employment in the calendar year, plus the payroll amount due from
that first payroll period.
The
following persons are EXEMPT from the LST:
1)
Any
person who is an honorably discharged veteran with 100% service-connected
disability.
2)
Any
person on active duty or being called to active duty.
Employers
shall be responsible for retaining a copy of all exemption certificates filed
by employees for each calendar year.
Also these certificates must be retained by the employer for no less
than three (3) years. Employers who have failed to withhold the LST
from any employee and have failed to retain an exemption certificate(s) will be
held liable for the payment of the LST as though the tax had originally been
levied against the employer.
CONCURRENT
& PRINCIPAL EMPLOYMENT:
In
the event that there is concurrent employment, where a taxpayer is engaged in
more than one occupation during a payroll period or where the employee is
required to be in more than one municipality within the same pay period, the
employer shall not withhold the LST, if the employee provides the most recent
pay stub from another employer that indicates the employer name, the payroll
period and the amount of LST withheld.
The employer is required to withhold and remit the tax to the collector
in the political subdivision considered to be the employee’s “principal place
of employment”.
REFUND
POLICIES LOCAL SERVICES TAX:
Any
person (employee) who believes that they are entitled to a refund of the LST
all or part must file a request for refund form which can be obtained from the
employer or the Special Tax Office. For
your convenience a refund form is also located on this web page at www.richlandtwp.com. All refund requests must be accompanied by
verification of earning and any other required information. (There is no exemption from the
TAXPAYER
BILL OF RIGHTS:
Act
50-98 of the Pennsylvania Legislature entitles taxpayers to receive a written
explanation of their rights with regard to Audit, Enforcement, Refund and
Collection of local taxes by contacting