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RULE §3.355Insurance Services

  (3) A multistate customer purchasing insurance services, such as actuarial services, for the benefit of both in-state and out-of-state locations is responsible for issuing to the insurance services provider an exemption certificate asserting a multistate benefit, and for reporting and paying the tax on that portion of the insurance services charge which will benefit the Texas location. A provider of insurance services that accepts such a certificate in good faith is relieved of responsibility for collecting and remitting tax on transactions to which the certificate relates.

  (4) The customer's books must support the assignment of the service to an identifiable segment of the business, the determination of the location or locations of the use of the service, and the allocation of the taxable charge to Texas.

  (5) To the extent the use of the service cannot be assigned to an identifiable segment of a customer's business, the service is presumed to be used to support the administration or operation of the customer's business generally. The service is presumed to be used at the customer's principal place of business. The principal place of business means the place from which the trade or business is directed or managed.

(k) Local tax. For information on the collection and reporting responsibilities of providers and purchasers of taxable services, see §3.334 of this title (relating to Local Sales and Use Taxes).

(l) Use tax. If a provider of an insurance service is not doing business in Texas or in a specific local taxing jurisdiction and is not required to collect Texas state or local tax, it is the Texas customer's responsibility to report and pay the use tax directly to this office.

Source Note: The provisions of this §3.355 adopted to be effective March 24, 1988, 13 TexReg 1224; amended to be effective November 13, 1989, 14 TexReg 5787; amended to be effective May 2, 1990, 15 TexReg 2284; amended to be effective March 23, 1995, 20 TexReg 1749; amended to be effective May 1, 2016, 41 TexReg 2970; amended to be effective May 7, 2018, 43 TexReg 2794

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