Software that eases the challenge of collecting sales tax, By Diana DiBello

San Mateo, CA -- (ReleaseWire) -- 07/29/2014 --Why should mid/small market companies be concerned about sales tax? Companies are required to collect taxes in most states where they do business. What’s so difficult—it’s just an invoice amount times the rate, right? Actually, it is much more complex, particularly when you throw in the need for sellers to determine nexus and make sure the correct rate is used. Businesses using ERP systems often fail to ensure that their tax calculation and returns processes are handled properly. And when these processes are handled improperly, it exposes the company to assessment and audits and causes unhappy customers.

To minimize the risks and decrease the likelihood of a sales tax audit, compliance issues must be addressed by companies that are required to collect sales taxes. It is likely that most companies are filing returns and paying their fair share, but many taxpayers struggle with complex state by state requirements when it comes to sales tax.

Companies first need to determine if they are required to collect tax. This is called nexus and refers to the connection a company may have with a jurisdiction that allows the jurisdiction to require the company to collect sales tax. This hurdle can be minimal and is often a topic of debate between the jurisdictions and companies. The barrier to jurisdictions of requiring sellers to collect taxes may be easily overcome by having employees solicit in their jurisdiction or own property in their jurisdiction, among other activities. That doesn’t even begin to look at the latest trend in states attempting to lower the hurdle even more with “click-thru” nexus laws aimed at requiring on-line retailers to collect the tax.

To read more visit: NetSuite Magazine (July 2014) - Tax Compliance, Simplified"

Download the NetSuite Magazine App on iTunes: Click Here

This content is distributed by iMirus, a technology and content partner of NetSuite Magazine. All content associated with this article is the exclusive ownership of NetSuite Magazine - ©2014 NetSuite Magazine All Rights Reserved.