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Simplifying Your Sales and Use Tax Decisions Through Outsourcing
Dru Beguelin November 5, 2007 — 1,200 views
Sales and use tax processing can be a costly and administrative burden that is not a corporate value-added function. With so much to keep up with, it can consume too much money and too much time. Compliance is a time sensitive function with state mandated filing requirements and deadlines. On top of that, the process of accurate and timely filing of return information is dependent on accurate information.
In recent years, a trend has started to develop of outsourcing sales and use tax compliance functions to a third party, relieving the weighty burden from a company and placing it in the hands of experienced professionals specializing in sales and use tax. Companies that have use tax issues, multiple locations in multiple states, retail outlets, mail order, internet web sites that are capable of sales are ideal candidates for compliance outsourcing.
There are many vendors that supply either integrated software solutions for in-house use or outsourcing solutions that remove this function entirely from company department’s or group’s. Many third party vendors offer industrial strength compliance services powered by proprietary databases and internet technologies that will prepare your sales and use tax returns and make remittances on your company’s behalf.
The primary objective of outsourcing sales and use tax compliance is return preparation and tax bill processing, however, what companies have failed to realize in the outsourcing of sales and use tax compliance is the internal resources needed to manage the peripheral administrative tasks that accompany this tax. A third party vendor may be handling your return preparation and tax bill remittances, however, we can’t loose sight of the accompanying minutia. Unless the third party vendor can offer a full array of services the company is still going to have the administrative burden of managing the numerous sales and use tax audits and everyday correspondence, notices and registrations, thereby, occupying what was thought to be a freed up resource for more value-added projects.
Be sure when looking to outsource sales and use tax that your vendor can alleviate the full burden of sales and use tax compliance. That vendor needs to not only process returns and remittances but also perform all the administrative tasks associated with this tax including audits if so desired.
With the expanding regulations and laws, sometimes the most beneficial direction for a company to go in is outsourcing. By allowing a third party vendor to operate sales and use tax compliance, company resources can be brought back in to continue to innovate and grow the business.
Dru Beguelin is a Partner at A-SALT Group, LLC where he is a member of a growing practice in the state and local tax arena. A-SALT Group is a dynamic company comprised of professional individuals who bring over 38 years of combined state and local tax experience to bear on your tax needs. His company offers a variety of services focused in the area of Sales and Use Tax, Canadian Sales Tax, and Property Tax.