Managing sales tax can be taxing for your company (no pun intended).
It involves constant monitoring of changes across jurisdictions and regulations, which can take your employees in finance away from performing more business-critical tasks.
In case that isn’t enough to convince you and your team to invest in automations that can streamline your sales tax processes, we’ve gone ahead and outlined other benefits that sales tax automation provides!
The learnings below come from a recent session hosted by our Business Systems community, Systematic. To attend future events with your peers and access recordings of previous ones, you can join the community!
1. Operational Efficiency
According to a report by the IDC, almost 50% of organizations still utilize data sheets and paper records as their main tool for tax compliance. This process can cause organizations to become overwhelmed and disorganized as their volume of data sheets and papers grows.
By integrating your sales tax automation software with your ERP system, you can have a single source for all your tax needs that can be accessed any time, anywhere. In addition, an automated tax solution that offers robust APIs can improve data accuracy by allowing you to pull real-time data for conducting tax evaluations.
2. Cost and Risk Reduction
One of the biggest justifications for implementing sales tax automation is the cost savings. It can help your company save in two ways.
Firstly, by automating tedious processes, you can save on the cost of manual labor. These savings can be reallocated to other special projects and needs. Secondly, automation can reduce the cost of potential audits and fines (which can be as high as $34,000 according to Mindwave Research), as it prevents your team from making mistakes that lead to overcharging customers. Avoiding this type of mistake can also help sustain trust between you and your customers.
3. Adaptability and Scalability
As your business grows, so too does the complexity of your business model. For example, as your business sells into new territories, your team needs to be up to date on each of their regulatory standards and tax policies. With sales tax automation, your organization can adapt to changes like this seamlessly, which enables your business to scale in a way that’s sustainable.
Do you have any burning questions around sales tax automation? You can get them answered by RevOps and Business Systems leaders in the Systematic Community! To get started, you can join the community.