Frequently Asked Questions
What is the Business Privilege and/or Mercantile Tax?
The Business Privilege and/or Mercantile Tax has been levied by the Municipality and/or School District in which a business is located and is based on the gross receipts of such a business.
What is a ‘Business’?
Carrying on or exercising for gain or profit, in the Taxing District, any trade, business, profession, vocation or commercial activity, or making sales in the Taxing District; a profession or vocation or any rendering of personal services in the Taxing District in any capacity, except as an employee of another, is a Business.
What are Gross Receipts?
Gross receipts means gross consideration received in any sale made or services rendered; or commercial or business transaction occurring in or attributable to the taxing district including cash, credits and property of any kind or of any nature without deduction on account of the cost of materials, labor, services or other costs, interest or discount paid or any other expenses whatsoever.
Are there ANY allowable deductions from total Gross Receipts?
Returns, refunds, any tax included in Gross Receipts and any exemption allowed by certain taxing districts are considered allowable deductions. Discounts offered and State Taxes are NOT allowable deductions.
Is rental property subject to the Business Privilege Tax?
Yes. Where the lessor has deliberately acquired rental property, receipts from same are subject to the tax.
Is manufacturing subject to the Business Privilege and/or Mercantile Tax?
No. The sale of manufactured products made directly by the manufacturer, is exempt from the tax. However, third party sales of manufactured products ARE NOT exempt.
If you are not subject to the tax because you claim to be a manufacturer, the PA State Manufacturing Exemption Form, showing the amount of manufacturing receipts not subject to the tax, must be included when filing the Business Privilege Tax Form.
What documentation is required when filing the Business Privilege and/or Mercantile Tax Return?
A copy of a Federal Schedule C, 1120 or appropriate Federal Form used to file with the Federal IRS must accompany the local Business Privilege and/or Mercantile Return. If such form is not available, other documentation (such as a spreadsheet) used to determine gross receipts, must be included.
How do I get a License to post at my place of business?
Licenses are included with the mailing of the Tax Form and fees, if applicable, are due on an annual basis. A License must be posted at each place of business whether or not a License Fee is required.
What if I don’t file and/or pay the Business Privilege and/or Mercantile Tax to which I am subject?
A fine and/or imprisonment, or both can be imposed upon anyone neglecting or refusing to file and pay the tax due.
Where do I file and pay the tax due?
Make checks payable to: HAB-BPT (short for: H A Berkheimer-Business Privilege Tax)
Mailing address is:
Berkheimer Tax Administrator
325-A N Pottstown Pk
Exton PA 19341
For assistance in filing the Business Privilege/Mercantile Tax, please call: 610-363-7214 or 800-360-7214 during regular business hours of 9:00AM thru 4:00PM, Monday thru Friday.
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 BERKHEIMER TAX ADMINISTRATOR at 610-363-7214 during regular business hours. If BERKHEIMER is not the appointed tax hearing officer for your taxing district, you must contact your taxing district about the proper procedure and forms necessary to file an appeal.
If you would like to view the most current edition of the Taxation Manual of the Commonweatlh of PA in its entirety click here. Click here to download a PDF of the Berkheimer Business Privilege Tax Rules and Regulations.