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How to Choose a Sales Tax Solution for Retail Nexus

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Alex Peter

If you’re selling goods in the US, we’d like to start off by welcoming you to our Complyt safe space. A space to take a deep breath and let go of the constant pressure to stay compliant, manage nexus obligations, keep the taxman happy, and mitigate exposure. It’s brutal out there, and managing your US sales tax compliance is no easy task. Mostly because of two things: your economic and physical nexus. 

These two types of nexus obligations determine the entire sales tax treatment(s), which all differ depending on your sales threshold in each state, the specific products you’re selling, and the physical location of employees and warehouses. Needless to say, staying compliant and in the loop with all your liabilities and the changing rules across all states can exhaust your critical resources and your peace of mind.

Hence, the monumental shift toward automated sales tax solutions. But can you trust one single solution with the entire tax posture of your retail business? In short – absolutely, but only if you choose the right one.

How to choose the right sales tax solution for retail nexus

Automating your sales tax obligations is becoming increasingly popular. Especially considering how prone to error, resource-intensive, and time-consuming manual processes can be. To keep a competitive advantage, you can’t afford to lose time, money, or your reputation due to non-compliance. However, not all sales tax solutions are created equal. 

Here’s what you need to know about choosing the right sales tax solution for managing your sales tax nexus. 

Does the solution integrate with your ERP and billing system?

Sales tax rates for retailers vary from state to state. Manually calculating this is extremely time-consuming and almost always results in errors. Even companies with sales tax solutions often complain that the rates aren’t accurate for their specific industry. To streamline the process and ensure that no single transaction is overlooked, ensure your sales tax solution can effortlessly integrate with your current finance stack and automatically calculate your sales tax directly on the system.

Do they consider all sales tax factors across departments? 

In brief, when navigating through your retail nexus, the sales tax process can’t work without significant inter-departmental input. Critical elements within your HR, sales, and tax departments all influence the risk of sales tax exposure and non-compliance. Consider how your solution integrates and aligns departments across the organization. For example, does it integrate with your HRIS systems to monitor your employees location and manage any physical Nexus obligations relevant to the geographic location of your employees? 

Are they up to date with the newest nexus and sales tax regulations? 

Each retail business is responsible for staying up to date with current legislation regarding sales tax and how each state classifies its specific product. Unfortunately, regulations are quick-to-change and can easily influence your entire compliance posture. One small misinterpretation or missed update, and you’re exposed. Find a sales tax solution that automates your obligations based on the most recent legislative updates and news regarding state-specific nexus obligations for your specific product, location, and industry. 

How does it support you before, during, and after an audit? 

General anxiety fills the room when someone brings up the dreaded a-word – audits. Businesses fear audits and aren’t proactively preparing for them due to a lack of support from experts in the field. 

Choose an automation software that prioritizes your audit readiness while managing the day-to-day compliance tasks. This includes helping you gather and retain the required proof, transaction history, or updates needed to pass them successfully. 

Remove the work (and worry) from sales tax compliance

In a competitive marketplace, businesses can no longer afford to pay for honest mistakes, especially when the consequences of a tiny error can result in significant financial losses. We remove the work and worry from sales tax compliance and replace it with one smooth, error-free process. 

Tag the Complyt team into your corner and kick out the burden of keeping tabs on all deadlines, rates, updates, and sales thresholds by yourself. We help you take care of all sales tax obligations on auto-pilot and step in when needed to ensure you approve all the relevant reports while staying on top of filing deadlines, tax calculations, remittance, and audit readiness. 

Don’t settle for complicated when you can have Complyt compliance. 

Find out how we can help your company
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