avalara ecommerce expo south florida sales tax
TRANSCRIPT
Confidential and Proprietary |
Making sales tax less taxing 2
Understanding the Complexities of Sales Tax – And How it Affects Your Business
• David Smart
• National Sales Manager, Ecommerce Team
• 5 yrs @ Avalara
• I’d rather be coaching baseball or fishing
CONFIDENTIAL & PROPRIETARY |
Making sales tax less taxing
Agenda• Avalara – your Partner for Sales Tax Automation
• What’s the big deal about Sales Tax ?
• How does this affect my business?
• How can you make this easier?
• What would you rather be doing?
Making sales tax less taxing
• Started in 2004, 900+ employees worldwide
• AvaTax market leading SaaS Sales Tax solution – 10,000+ Customers
• End-to-End solution for handling Calculation, Filing and Certificate Management
• Filing over 30,000+ tax returns per month
• Magento Gold Solutions Partner / Top 5 Extension Customer Pick
• Geekwire 2014 Next Tech Titan
• Geekwire 2015 CEO of the Year
Making sales tax less taxing
The state of our States
States are still recovering from the Great Recession
In 2013, 31 states projected budget deficits totaling $55 billion
NRF estimates $24 billion in sales taxes goes uncollected on the Internet
Therefore
As tax-collecting agents of the State(s), they are looking to your business to find more money
This increased focus creates compliance risk for you
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What does it take to be compliant?
• Nexus• Taxability• Managing exempt customers• Accuracy • Remittance
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Making sales tax less taxing
Do you have traveling sales people in the state?
Do you have agents or affiliates in the state?
Do you conduct training in the state?
Do you own or rent property in the state?
Do you promote your products or services in the state?
Do you participate in trade shows or exhibits in the state?
And every year this list grows!
Nexus – More than just having a location or employee
Making sales tax less taxing
Tree Trimming in California
TaxableWith Lights
ExemptLabor Only
Snow Removal in Midwest
TaxableOhio
ExemptIllinois
Candy Bars in Indiana
TaxableNestleCrunch
ExemptKit Kat,Twix
New YorkTaxableSlicedBagel
ExemptWhole Bagel
Takeout in ColoradoTaxableStraws, Cup Lids
ExemptCups
Donuts in TexasTaxable
<5Exempt
>6
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Making sales tax less taxing
Understanding product & service taxability exceptions
The following industries have varying taxability rules:
J Software / hardware
J Digital goods
J Services
J Medical device / equipment
J Food / beverage
J Clothing / apparel
J School-related products
J Dietary supplements
J And many other industries / products
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Why do Companies Automate Sales Tax?
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Making sales tax less taxing
Because they hate dealing with it...
52% of accounting professionals agree: completing a marathon would be easier to accomplish
than understanding sales tax compliance laws.
Source: Wakefield Research 2013
Making sales tax less taxing
Researching tax rates
Building tax tables
Researching taxability
Collecting certificates
Storing certificates
Running reports
Filling out tax forms
Mailing returns
Paying taxes
Even small companies spend significant time on manual compliance
12.7 monthly hours calculating sales tax
18.2 monthly hours managing exemption certificates
11.0 monthly hours filing and remitting sales tax
Source: Aberdeen Group, 2011
Making sales tax less taxing
• 150+ million mailing addresses
• 11,000+ jurisdictional rules
• 35,000+ sales / use / rental tax rates
• ~ 30 M product / service exemptions
• 750,000+ buyer / seller exemptions
www.avataxrates.com
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State Sales Tax Returns
• CA - 169 separate taxing jurisdictions– County
– City
– Special Taxing Jurisdiction (STJ)
• TX – 1581 separate taxing jurisdictions• NY – 62 counties + Cities & STJ
• Must break out the jurisdictions in order to file correctly• http://www.tax.ny.gov/pdf/current_forms/st/st810.pdf
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Making sales tax less taxing
Who fits the profile?
• Company size – “Mom & Pop’s” all the way to enterprise
• Collect sales tax in multiple states or in difficult states like CO, WA, CA, TN, NY, IL, MO, TX, FL.
• Industries – Software and technology, food, clothing and apparel, services, media and gaming, and medical device companies
• Multi-channel Commerce (Ecommerce, ERP, Recurring billing)
• Recently audited or going through an audit
• Sales to Resellers/Distributors (B2B)
• Upgrading software, new implementations
• Rapid Growth (new states)
Making sales tax less taxing
Customer – Christian Louboutin
Expanding into US markets
Nexus in a couple of States
Selling Clothing & Apparel Items
No Internal US Tax Expertise Solution:
Selected Avalara to Automate Sales Tax Calculation & Filing
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Making sales tax less taxing
Customer – Simms Fishing
Large B2B Retail/Wholesale Channel
Expanded Business Model to include B2C
Nexus Exposure nationwide
Minimal In-House US Tax Expertise
Solution:
Selected Avalara for end-to-end Sales Tax Automation - Calculation, Filing and Exemption Certificates.
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Making sales tax less taxing
How does it work?
Tax RatesTax BoundariesTaxability Rules
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Let’s sum it all up
• Sales tax is incredibly complicated, accuracy is key, and outsourcing is strategic
• AvaTax is simple, easy to set up and painless to manage
• Avalara is here to provide all the sales ‘air support’ you need. Less taxing more relaxing!
CONFIDENTIAL & PROPRIETARY |
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Questions?
• David Smart
• National Sales Manager - Ecommerce Team
• 206 356 6227
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Interested In Learning More?
• Contact Rand Internet Marketing for further information!
• Call us at 1(888)707-RAND
• Email us at [email protected]
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