The City of Philadelphia through the Mayor’s Office of Communications <firstname.lastname@example.org> releases updates as part of their Business tax relief programs. In the Dec 1, 2020 communication, the City of Philadelphia stated the change in Use and Occupancy for restaurants as we requested after our attendance to the Tax Committee Meeting back in October 2020.
We mentioned to the Tax Revenue department that there were Use and Occupancy exemptions from the portions of commercial properties not in used based on the guidance from their official website – https://www.phila.gov/services/payments-assistance-taxes/business-taxes/use-occupancy-tax/ As a result, at the City of Philadelphia has restricted the activity either completely (no indoor) or partially 25% or 50% limitation, then, we understood that portion of the establishment was not in business use, and not subject to Use and Occupancy for the allocated amount.
Can you be excused from paying the tax? Portions of your property may be excluded from the assessed value when determining the Use and Occupancy Tax. This results in a lower total tax amount owed. Exemptions include:
Vacant commercial properties, or portions of commercial properties that are not currently in business use.
The following language was included in the December 1, 2020 communication from the Mayor’s Office of Communications:
Amending U&O guidance to exempt the portion of restaurants and bars used for indoor dining from Use & Occupancy Tax: This initiative will exempt restaurants and bars from Use & Occupancy tax on the square footage of the business used for indoor dining (dining room space) during the period when indoor dining is prohibited. This exemption is for this most recent “Safer at Home” phase and would be effective from November 20, 2020 through January 1, 2021.
Note that if you already submitted the payment for U&O taxes for your restaurant, you can always request a refund from the City.