They say the definition of insanity is doing the same thing over and over and expecting a different result. Well as the sales and use tax landscape changes, so does the complexity of getting tax right. Here are the top seven reasons to look to change your status quo:
1. Expanding requirements. As your business grows, so may your tax requirements. If you start doing business in a new country or state, begin selling or purchasing new products, or file more compliance returns, you will need to ensure you are using a product that can scale with your business needs.
2. Changing ERPs. This is always a good time to look at your current tax and compliance procedures to ensure you are utilizing the most efficient and correct ways to handle tax.
3. Audit Exposure. Utilizing an automated sales and use tax systems is the best way to ensure your compliance with state and regulatory tax audits and to avoid penalties and interest if not. But remember, all systems are not created equal. Make sure your system handles all your company and industry needs.
4. Automatically calculate the right tax every time. The ability to automate the entire sales, use and compliance process is the best way to ensure tax accuracy and reduce manual, time consuming procedures.
5. Previous Audit Penalties. Penalties and interest assessed during an audit indicates your current system is not meeting your requirements and that you have exposure to future audits. This is a time to reassess your needs and find a solution that will protect you against it.
6. Reduce tax processing resources. If you find that sales tax compliance takes too much time and resources, then you should evaluate ways to reduce the processing time by implementing a fully automated system.
7. Automate return filing and reporting. Most time spent on tax is usually spent doing monthly sales tax returns or reporting. A large part of this process can be automated by utilizing a US or VAT Compliance Solution. This will save time by populating the forms with your data and save money by ensuring the data goes on the right forms in the right place.
Understanding your sales and use tax requirements is extremely important when selecting the correct solution for your company. It should easily scale with your business, handle industry specific requirements, and get it right every time.