Before
This is how the content was given to me by the city finance department:
Anyone who performs construction work that requires a City of Golden building permit must pay City building use tax on the cost of construction materials used. Construction materials are estimated to be 1/2 of the cost, and the City building use tax is paid on that amount when the permit is issued. No City sales tax is charged when the materials are actually purchased if the permit is presented to the seller. The actual material cost is computed at the end of the project and the difference is paid to the City or refunded to the permit holder. This may be done by a contractor at the end of a project or when the City reviews the records during an audit.
Contractors must keep all invoices and statements from all general contractors, subcontractors and suppliers of construction materials, along with a summary sheet showing such purchases for three (3) years from the date of issuance of the certificate of occupancy.
The cost of a building permit is an estimated prepayment of use tax.
For more information on obtaining a building permit, please visit our Permits & Fees page.
After:
I rewrote the content in plain language and reformatted into specific actionable steps. By chunking the information this way, the user can easily scan the information and identify what they need to know.
When you’re working on construction projects that require a City of Golden building permit, it’s important to be aware of the City Building Use Tax:
1. Payment Process:
- The city building use tax applies to the cost of construction materials used.
- Construction materials are estimated to be half of the overall cost.
- The tax is paid on this estimated material cost when the permit is issued.
2. Sales Tax and Permit Presentation:
- No city sales tax is charged when purchasing materials if you present the permit to the seller.
- This ensures you’re not double-paying taxes on materials.
3. Final Cost Adjustment:
- The actual material cost is calculated at the project’s end.
- Any difference is either paid to the City or refunded to the permit holder.
- Contractors can handle this at the project’s completion or during a city audit.
4. Record-Keeping Requirements:
- Contractors must retain invoices and statements from all involved parties (e.g. general contractors, subcontractors, and material suppliers).
- You should include a summary sheet detailing all purchases.
- Maintain these records for three (3) years from the certificate of occupancy issuance date.
The building permit cost serves as an estimated prepayment of the use tax