Among the most frightening words a business owner can hear are the words: sales tax audit. There are many reasons why this is a phrase that should be feared, not the least of which is that the negative outcome of a sales tax audit may cost you your business, your accounts receivable, your current business & personal assets, and can leave you starting over with nothing. There are options available to you though, keep reading to learn how you can survive this trying time.
Begin with the best possible defense – an exemplary system of record keeping when it comes to sales tax paid, received, and possible exemptions. Document everything and review your documents with an internal sales tax audit yearly. This gives you a great opportunity to catch mistakes that may have been made and correct them before an actual audit takes place. You will also want to review your documentation immediately prior to your audit.