Establishing Legal Taxpayer for FPHT
(1)It is the policy of the department to use the following sequential criteria to establish the identity of the taxpayer responsible for the Forest Products Harvest Tax (FPHT):
(a)The party holding title to timber as evidenced in a written agreement.
(b)If the element of (a) is not present, the party indicated on the “Notification of Operations” as the timber owner.
(c)If the elements of (a) and (b) are not present, then the party receiving payment for logs delivered to a conversion center.
(d)If the elements of (a), (b), and (c) are not present, then the owner of land from which harvest occurred is the responsible taxpayer.
(2)The following examples of transactions are a guide in determining the responsible taxpayer: [Example not included. See ED. NOTE.]
(3)The department will consider the following elements when it is necessary to interpret a written agreement in order to establish identity of the taxpayer:
(a)Type of agreement — i.e., a contract for the performance of services vs. a contract that transfers the ownership of property.
(b)The intent of the agreement.
(c)Which party enjoys the “benefit of ownership”?
(d)Which party bears the loss in a catastrophic event?
(e)The timing of and manner of payment.
(4)Whenever an agreement is so ambiguous that identity of the taxpayer cannot be reasonably determined, the last party known to hold title to timber or logs will be deemed the taxpayer.
Rule 150-321-0010 — Establishing Legal Taxpayer for FPHT,