Things to Consider in IFTA Fuel Tax Audit
IFTA audit is complex and always stressful for the owner of the Transportation Company. Generally, owners always avoid IFTA audits. They do not want to have audits of their IFTA reports. According to some report, 3 percent of IFTA reports are audited under the jurisdiction. IFTA audits the reports randomly and identifies any reporting error found. But if you have prepared the reports correctly with all the checkpoints, then you do not have to worry at all. Here are the 5 things compiled that you can remember in IFTA audit. If your vehicles are selected for IFTA audit, then there will be the following steps involved.
The fleet owner will be notified about the audit. An auditor will be assigned before 30 days from the IFTA audit. Some basic questions about the fleet may be asked by the auditor, so be prepared to answer. You need to share some records summaries like fuel statements, mileage statements, and receipts. The auditor will verify the authenticity and accuracy of the miles covered during the reporting quarter. Auditors will visit your firm and may look for the inaccuracies in fuel reported without any miles logged, error in mileage, etc.
After the completion of the IFTA audit manual, you are required to choose any action based on the results of the audit. Actions include no action if no discrepancies have been found, accept the result, make the payment, or challenge if you disagree with the reports. If you are disagreeing, then you may ask for detailed audit or a new auditor. IFTA audits have to be filed four times a year and there are chances that you might miss the deadlines. However, this is blunder must be avoided at any cost. If there is any delay or late in submitting the reports, you will have to pay $50 penalty or 10% of the net tax liability. Hence, your chances of IFTA audit are also increased.
IFTA fuel tax calculation is a time-taking process. So, it is always better to go with good quality software. It is really hectic to do the estimation while filing up a lengthy report. However, you need to avoid these mistakes. Always give the accurate and exact figure to make a precise report. Inaccuracies can raise doubt and there are chances of IFTA audit. Generally, the owners forget to include the personal miles and that is a big mistake. If you do not include the personal miles travelled, then it will create a mileage gap in the record.
This can be easily avoided with some attention. Any discrepancy can create a doubt during the IFTA audit. Be careful to check odometer issues. If you found any odometer issue, make sure to correct it. Issues with Odometer or GPS tracking can affect the IFTA reported figures. So, if there is an issue, prepare a note of such incident. In manual IFTA calculations, there are huge chances of mistakes or inconsistencies. To eliminate the error completely, you can employ the best software available in the market. The software will increase operational efficiency, calculate distance covered, and removes clerical errors. It also helps to prepare accurate reports for IFTA audit.