Sales Tax Fundamentals
Get up to speed on the basics of sales tax
How to choose a sales tax software solution
byMarch 31, 2022
Choosing a sales tax software vendor for your company can go one of two ways. If you pick the right vendor, you’ll appreciate the functionality and overall experience that allows your team to focus on high-value projects instead of the mundane aspects of sales tax. On the other hand, selecting the wrong sales tax management software or deploying the right software incorrectly could waste time and resources, trigger potential fines for mistakes, and, if things don’t work out, introduce switching costs involved with moving to a new vendor.
With a growing list of companies to choose from, why risk setting employees or whole departments up to fail by selecting the wrong vendor? The right software provider sees you as a partner throughout the tax process. Through sales tax automation, you won’t need to track state tax laws, tax rate changes, and economic nexus manually. You’ll also have an easier time with product taxability and record keeping especially as you file returns.
Having a well-thought-out evaluation strategy before selecting or shortening your list of potential SaaS vendors can keep you one step ahead of a wrong decision. So that you’re not starting from scratch, we’ve created an interactive, ‘How to Select a Sales Tax Vendor guide to help.
So why build a software evaluation strategy?
Before digging into how you should build your evaluation or vetting strategy, it’s worth considering why a strategy is critical. As your company grows and your sales tax obligations increase in complexity, applying the right level of scrutiny upfront ensures you’re making the most informed decision. Whether you’re a small business working with a tax professional or a larger business managing compliance in-house, our new guide will help make the evaluation process run smoothly.
In the guide, we cover the following:
- Understanding your business needs
- Asking the right questions upfront
- Keeping an eye on accuracy and performance
- Reporting & automated filing capabilities
- Understanding the technology
- Implementation support
- Security-first approach
- Supporting existing integrations
- Finding the right partner
- And more
Why hire a sales tax solution vendor now?
With thousands of taxing jurisdictions throughout the U.S., a company’s path towards sales and use tax compliance comes with twists, turns, and unwelcome surprises. Part of the complexity stems from global events such as the pandemic, which has shifted consumers’ buying behavior in favor of e-commerce.
Of course, the convenience of online shopping is great for consumers, but as you know, it complicates things for sellers as you sell more online into new states and jurisdictions. For instance, in our recently released Future of E-Commerce report, 78% of finance leaders say they believe their e-commerce business will continue growing in the future. This growth can unexpectedly alter a company’s tax filing process, especially regarding where and when they must collect and remit sales tax.
As sellers quickly discovered, straddling online and offline channels can easily trip them up when collecting and remitting sales tax. As a result, sales tax automation can be a much-needed ‘crutch’ to help financial leaders mitigate risk, streamline sales tax compliance, and focus on their core business.
With software solutions like TaxJar, you’ll have a dedicated team of tax experts ready to help you tackle these challenges head-on instead of going at it alone. However, knowing you need a sales tax solution is why you’re here – helping you choose the right partner for sales tax automation is what our ‘How to Select a Sales Tax Vendor guide aims to do.
How will the sales tax vendor guide help you?
Through our interactive guide, you’ll be able to formulate a comprehensive vetting strategy to help you pick the best sales tax partner for your business. Streamlining your tax compliance journey doesn’t have to be a burden, especially when equipped with the right questions and guidance upfront. For instance, in the ‘Understanding the business needs’ section, we help you tease out key considerations as your business evolves and your sales tax obligations evolve or change.
We also provide vital considerations when evaluating the performance and accuracy of a potential vendor’s real-time tax calculations. Suppose sales tax automation is at the top of your list. In that case, we dive into how you should be thinking about automated remittance and how you can aggregate transactional data across all channels (including marketplaces) as you reach economic nexus in new states.
We also discuss what you should look for when evaluating system performance, integration partnerships with existing ERP and e-commerce platforms, security certifications, and other essential features. Throughout the guide, we also share a curated list of links to other sales and use tax assets so that you won’t have to go searching for them manually. We hope you feel empowered as you meet with vendors and can walk away knowing you’ve asked the right questions to make the best decision for your business.
Wherever you are in your sales tax journey, our ‘How to Select a Sales Tax Vendor’ guide may be what you need to help minimize missteps as you search for the best sales tax automation solution with the right pricing for your business. Our customer-first approach to sales tax compliance and obsession with creating the best customer experience will give you confidence in knowing that you’re doing sales tax right – all the time, no matter where your customers are located.