- Sales tax audits are complex and data-intensive events that most companies will face at some point
- Being proactive in preparing for a sales tax audit can help minimize the risk of an unfavorable outcome
- Proactively preparing means implementing best practices to reduce errors before an audit occurs
- State auditors are looking to recover revenue by identifying instances of underpaid or underreported taxes
- Auditors typically use statistical sampling of transactions for the audit period rather than reviewing all transactions
- Companies should prioritize making their sales tax operations and compliance functions audit-ready
- Retail or seasonal businesses may see audits focused on periods with higher transaction volumes, such as Black Friday and Cyber Monday
Source: tax.thomsonreuters.com
Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.
