Florida Revokes Registration

Certificate of Registration

Companies who do business in Florida and have nexus are required to register for sales and use tax with the state of Florida Department of Revenue (FL DOR).  If a business will have taxable transactions, it must register with the Department of Revenue before conducting business in Florida.

Upon approval from FL DOR, the taxpayer receives a Certificate of Registration (Form DR-11) and a Florida Annual Resale Certificate for Sales Tax (Form DR-13). The resale certificate allows businesses to purchase or rent property or services tax-free (when such purchases or rentals will be resold or re-rented).

Revocation

FL DOR has the authority to revoke a company’s Certificate of Registration.  A recent case in the state of Florida is an example of FL DOR revoking a company’s Certificate of Registration.

In the case of Florida Department of Revenue v. Dive Professionals, Inc., d/b/a/ Atlantis Dive Center (Fla. Div. Admin. Hearings, 2015-002-FOF, 03/09/2015), Florida revoked the taxpayer’s sales and use tax Certificate of Registration because the company failed to abide by repayment terms as agreed in a compliance agreement with the Department of Revenue.

It turns out that the taxpayer instead of remitting sales tax collected to the state had been using those funds to pay for fuel, wages, and other business expenses.  The taxpayer entered into an agreement with FL DOR to repay the tax including penalty and interest that was owed.  The taxpayer defaulted on the agreement and did not timely file tax returns and remit tax due, a violation of Fla. Stat. § 212.  FL DOR, being duly authorized to do so, therefore revoked the taxpayer’s Certificate of Registration.

Implication

Without a Certificate of Registration, in most cases businesses must shut their doors and cease to operate.  FL DOR does have the authority to revoke a taxpayer's Certificate of Registration if that taxpayer fails to comply with Chapter 212.  The DOR must comply with all of the requirements of Fla. Stat. § 212.18.  There are a number of steps that the state must take before a Certificate of Registration is eventually revoked.  Without a sales tax Certificate of Registration, a business is no longer authorized to sell or provide any services that are subject to Florida sales and use tax.

Tips for the Taxpayer

Sales tax collection is granted by the state to registered taxpayers.  Taxpayers are required to collect sales tax on taxable transactions and remit sales tax collected to the state.  Ensure your sales tax collection is remitted to taxing authorities by performing a compliance review of your sales and use tax process.  Reconcile accounts to the general ledger to compare tax collected to tax remitted on a monthly basis.

For More Information

If you are interested in learning more about this topic or other tax topics, please visit our Tax Publications under News and Events at www.allynintl.com.

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Allyn files state and local sales and use tax returns in every US taxing jurisdiction.  We can manage your tax compliance and registrations, create a solid tax process, and provide audit defense for your company.

Contact us and we can provide a customized cost-effective solution to meet your company’s needs.  For further information on Allyn Tax services, please contact: tax@allynintl.com.

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