THE SALES/USE TAX AUDIT PROCESS
The St. Charles Parish School Board Sales/Use Tax Department audits businesses located in our parish, companies that delivery to our parish, and companies that perform services in our parish. Companies may be selected for audit based on one or more of the following reasons: (a) not charging tax or incorrectly charging tax; (b) not accruing tax; (c) improper use of exemption certificate; (d) collecting and not remitting tax; (e) industry non-compliance problem; (f) tips from individuals; (g) not registered for sales/use tax; or a routine compliance examination.
How Your Audit Will Proceed
The St. Charles Parish School Board Sales/Use Tax Department has scheduled a routine audit of your business records. Our auditors will contact you to set up a mutually agreeable time to begin the audit. We audit many taxpayers regularly, so you should not feel that we have singled out your company.
The law authorizes us to examine the books, records, papers, and equipment of a business to determine if the correct tax was paid to the Parish.
Our auditors are accounting professionals, familiar with the application of Louisiana tax laws to your business. The auditor will conduct an impartial examination of all necessary records.
On occasion, we utilize the services of a contract audit firm as authorized in LA R.S. 47:337.26. Please be assured that the same high standards of professionalism and ethical conduct are required of representatives of these firms as if they were employees of the
St. Charles Parish Sales/Use Tax Department.
If you believe that you will be subject to other local audits and would like to make arrangements for a single local tax examination, please call our office, (985) 785-7249, to make arrangements.
While the audit is in progress, the auditor will answer any questions that may arise. When the audit is complete, the auditor will provide schedules, exhibits, and a summary of their findings. They will also explain the procedures available to you if you disagree with the results.
Examination of Records
Often, the size and complexity of a business determines what records will be examined during the audit. Therefore, the law requires the taxpayer to furnish all records requested by the auditor that are necessary for conducting a complete audit. Every effort will be made to limit the inconvenience of the onsite portion of the audit process.
These matters, and others, will be discussed during the entrance conference.
LA R. S. 47:1508, Confidential character of tax records, requires that all information obtained from an examination of the taxpayer’s records be held in the strictest of confidence except in the administration and enforcement of the tax laws.
Purchase invoices for
Capital asset invoices
Current files of
resale and exemption
general ledgers and
Charts of accounts and
reflecting profit and
Federal income tax
Working papers and
accounting data used to
prepare tax reports
Interest accrues at the rate of 1.25% per month upon the unpaid tax amount due. The interest shall be an obligation to be collected and accounted for in the same manner as if it were a part of the tax due and can be enforced in a separate action or in the same action for collection of the tax and shall not be waived.
Penalties of up to 25% may be imposed for the failure to timey report or pay over any taxes due. Upon receipt of a written satisfactory explanation, the Director may waive payment of the whole, or any part of the penalty, but cannot waive payment of any tax or interest.
After the expiration of the notice of formal or final assessment, should it be necessary to turn over any matter to an attorney for collection, taxpayer may be subject to attorney fees.
Although we do not
routinely bill for audit
costs, LA R.S. 47:337.75
provides that, under
an amount may be added
to the assessment to
reimburse the School
Board for all costs
incurred in making the
examination or audit.
Audit Methods: Detailed vs. Sampling
Generally, the auditor will first examine a portion of the business’ records to determine if there are errors in compliance with tax laws. If errors are found, the following types of audits will be performed.
A detailed audit – the auditor will examine all business records for the entire audit period. Traditionally, detailed audits are performed on small businesses that have a minimal amount of transactions or records. However, detailed audits are also performed when grossly false or fraudulent returns have been filed, or as a part of a criminal investigation.
A sample audit – the auditor will use sampling methods by which errors found in a representative sample of business records are projected through the entire audit period. Sampling provides accurate results at a significant savings of time and manpower for both the taxpayer and the Parish. The sampling procedure and the population to be sampled will be agreed upon before this process begins. Of course, if the records are inadequate, the audit will be based on the best information available.
In performing tax audits, auditors have various audit tools available, including computers. In addition to using hard copy records, the School Board employs computerized audit methods using taxpayer data files. The use of computers will enhance audit accuracy and save time and energy for both taxpayer and auditor.
If the examination determines your business complies with local tax ordinances and the uniform local sales tax code for the period under review, you will be notified accordingly.
If the examination
uncovers additional tax
Proposed Assessment/Request for Hearing
If you are in agreement with the audit findings as contained in the proposed assessment and additional tax is due, please remit the total amount due made payable to St. Charles Parish Public Schools. Your payment must be made within thirty (30) days of the date of the notice. If you disagree with the audit findings, the Uniform Local Sales Tax Code (LA R.S. 47:337.48B) provides that, within thirty (30) days from the date of the proposed assessment, you may file a written protest fully disclosing, the reasons together with facts and figures in substantiation thereof, and request a hearing. This protest should fully disclose the reasons, together with data in substantiation thereof, for objecting to the assessment. The Director shall consider the protest, and shall grant a hearing thereon, before making a final determination of the tax, penalty, and interest due.
If you fail to comply with the provisions of the proposed assessment or once a final determination of the amount due has been made following a hearing, the Director will notify you of the assessment. As provided in LA R.S. 47:337.51A(1), if you wish to protest, the findings in the assessment, you have thirty (30) calendar days from the date of the notice to do any of the following:
1. Pay the amount of the assessment.
2. Appeal to the Board of Tax Appeals for redetermination of the assessment.
3. Pay under protest in accordance with R.S. 47:337.63 and then either file suit or file a petition with the Board of Tax Appeals all as provided for in that Section.
Tax Review Committee |
From the Director
Questions should be directed to the auditor who performs the examination. However, if assistance is needed before the audit begins or if concerns arise during the audit that you would prefer not to discuss with the auditor, please feel free to contact the Audit Manager at (985) 785-7249. Our examination, although necessary, should be a minimal intrusion upon your daily operations.
Sales/Use Tax Department