Question

1. What are the financial accounting implications of SBD should consider as it’s assessing its sales tax responsibilities.

Answer 1

It is true that there are various financial implication of SBD nature, which shows that responsibilities which are silent but dadly indicated that there are various responsibility of the firms which are to be performed well in advance without delay and concurrent significant for the organization and the agencies.

One of them is SALES TAX Responsibility which is crucial for the firms as well as for the organization to collect its revenue and utilizing to build nation and welfare activites.

As per sales tax is concerned there are various compliances to be fillled in time so, the seller must note of that compliance .

Sales permit must be necessary for each seprate place of business inthe state.

In many states, its treated as criminal offence to perate the business activity without requisites permit

In recent years ,online trade is growing so many states have stepped up to register the seller for the purpose of collecting more and more taxes.

The amount of tax which is taxable sale, is determined by applying the appliacable tax rate to the total sale price. Basically tax applies to that amount which is received for property or service without any deductions.

Seller are generally responsilble for collecting sales tax and deposit that amount to the government.

It is also the duty of seller to check the tax rate as tax rates are not constant but varying depending upon the type of items to be sold.

There are various methods to be used for collecting the sales tax but amount collection from sales tax must be deposited in the government account within the time period.

There are few states which permit the seller to absorb the sale tax.

Once selller collected the amount of sale tax for a particular period on the selling item it is the duty of the seller to a report and paying the tax to the appropriate authorities and most of the states require to file a tax return and remid the sales tax on monthly basis.

This reporting may be in the electronic form and also depositing the sales tax amount electronically.

If the seller remid more tax, compared to actual one either due to clarical error or due to misinterpretation of the law, a state either refund the excess amount or credit is given on the next return.

Accurate recording of all the books regarding sale is essential for the seller and also report the return on sales tax liability.