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Sales and Use Tax EFT Section

Electronic Funds Transfer (EFT) payments were first authorized by Act 848 of 1993. This act provides that businesses with Excise Tax Permits that have an average tax liability of $20,000.00 a month are required to make scheduled payments by EFT. Other businesses that are not required by law to make EFT payments may voluntarily make payments in this manner if they have a monthly liability of $2,500, complete the EFT-1ST (PDF) form and a Voluntary Agreement form (see table of links at bottom).

Also, Act 848 provides a 5% penalty to be assessed against businesses that are making EFT payments, and fail to make their payments by this method.

Selection Process

Businesses that are required to make payments by EFT are selected by the Sales Tax computer system in October of every year. The selection process looks at businesses' last fiscal year history to determine if they are required to make payments by the EFT method. Businesses that are selected receive a notice letter and an EFT-1ST form. The businesses complete the EFT-1ST form and send it back to our office. Sales Tax then notifies its bank of the new businesses that will be making EFT payments. The bank then sends each business instructions and/or information to get started in making payments by EFT. Newly selected businesses will normally begin making EFT payments in January of the following year.

Other EFT Information | EFT Forms

EFT payments must be transmitted by 3:00 p.m. Central Time, one working day before the due date. If the due date falls on a weekend or holiday, then the next working day becomes the due date. See Due Dates below.

Tax Type codes effective January 29, 2009 and thereafter

Tax Code	Type Used For
04020	Gross Receipts/Use State Tax Payment
04201	Sales Tax (Pre-Payment #1)
04202	Sales Tax (Pre-Payment #2)

Note: If you are required to make payments by Electronic Funds Transfer (EFT.), the EFT. payment must be transmitted at least by 3:00 pm. Central Time, one business day before the above mentioned due dates.

Federal Banking Holidays and State Holidays are not business days.

2009 Filing Due Dates

JAN	FEB	MAR	Description
12	12	12	Sales & Use Tax 1st Prepayment
20	20	20	Sales & Use Tax Monthly Report for previous month
26	24	24	Sales & Use Tax 2nd Prepayment

APR	MAY	JUN	Description
13	12	12	Sales & Use Tax 1st Prepayment
20	20	22	Sales & Use Tax Monthly Report for previous month
24	26	24	Sales & Use Tax 2nd Prepayment

JUL	AUG	SEP	Description
13	12	14	Sales & Use Tax 1st Prepayment
20	20	21	Sales & Use Tax Monthly Report for previous month
24	24	24	Sales & Use Tax 2nd Prepayment

OCT	NOV	DEC	Description
13	12	14	Sales & Use Tax 1st Prepayment
20	20	21	Sales & Use Tax Monthly Report for previous month
26	24	28	Sales & Use Tax 2nd Prepayment

2010 Filing Due Dates

JAN	FEB	MAR	Description
12	12	12	Sales & Use Tax 1st Prepayment
20	22	22	Sales & Use Tax Monthly Report for previous month
25	24	24	Sales & Use Tax 2nd Prepayment

APR	MAY	JUN	Description
12	12	14	Sales & Use Tax 1st Prepayment
20	20	21	Sales & Use Tax Monthly Report for previous month
26	24	24	Sales & Use Tax 2nd Prepayment

JUL	AUG	SEP	Description
12	12	13	Sales & Use Tax 1st Prepayment
20	20	20	Sales & Use Tax Monthly Report for previous month
26	24	24	Sales & Use Tax 2nd Prepayment

OCT	NOV	DEC	Description
12	12	13	Sales & Use Tax 1st Prepayment
20	22	20	Sales & Use Tax Monthly Report for previous month
25	24	27	Sales & Use Tax 2nd Prepayment

Frequently Asked Questions Concerning EFT

What payments do I have to make by EFT?

Businesses only make scheduled payments by EFT. Any additional tax billings that businesses receive must be paid by check. Scheduled payments are defined as Pre-Payments (if required) and the monthly report payment.

Does the state automatically pull money (payments) from my bank account?

The State of Arkansas/Sales and Use Tax Section does not automatically pull money from a taxpayer's bank account. The taxpayer/business must initiate the transaction which informs their bank of the amount of money that will come out of their account and moved to the state's bank account.

Is EFT like a "Fed Wire"?

EFT is not like a "Fed Wire." EFT is the transferring of money from one account to another with an informational record attached. The informational record contains your permit number, type of tax being paid, amount of payment and the period of the payment. The state does not accept a "Fed Wire" as a valid EFT payment and such payments may be subject to the "Failure to EFT" penalty.

What is ACH Debit and ACH Credit?

An ACH Debit transaction is a transaction whereby the business makes an EFT payment by simply calling an toll free 800 number and following the steps listed in the telephone program. The money is debited from the business's bank account and credited to the state's account. This type of transaction is simple and there is no cost to the business for performing this transaction.

An ACH Credit transaction is a transaction whereby the business makes their EFT payment by using computer software via modem or the EFT transfer is made by a bank or some other financial service company. This type of transaction may have some cost to the business and usually requires some time to get set-up to perform these actions. With the ACH Credit transaction the business assumes the liability that the money and record information is correct.

Which method (Debit or Credit) is best for you or what is
the advantage of one method versus the other?

The ACH Debit is the easiest and quickest way to make EFT payments and may be the way to go for many businesses that are not familiar with EFT payments.

ACH Credit is preferred by some businesses because they do not have to give the state their bank account information to perform this transaction. Also, many businesses like to have total control of their transactions and it's more efficient if they make many payments by this method.

The choice is yours and both methods work for us.