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  Reporting sales on the accrual or cash basis

Q.  Should I report my sales on the accrual basis or the cash basis?


A. In general, sellers of goods and taxable services must report sales on the accrual basis. All sales must be reported for the reporting period in which the sale is made, not for the period when the customer pays for the purchase.

For example, if a sale is made on March 30 and payment is received on April 12, the sale must be reported and tax paid for the reporting period ending March 31.

Sellers whose only sales are of certain taxable services, and who file with the IRS on a cash basis, may also be able to report their sales of those services to DRS on the cash basis. This means they can report the sale for the reporting period in which payment for the service is received rather than when the sale is made. Contact DRS for more information about who may file on the cash basis.

(Updated: 2015)

This answer is intended to provide general information concerning a frequently asked question about a current position, policy, or practice associated with the taxes administered by the Connecticut Department of Revenue Services.  It may include an informal interpretation of Connecticut tax law by the Department of Revenue Services (DRS).  However, it is not intended to serve as a legal ruling.

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