winston_churchilljpg_Page1For many businesses, when it comes to sales tax compliance, they must deal with data that is sourced from multiple systems.  Businesses often have e-commerce sites and legacy invoicing systems that are configured differently. Any type of acquisition may introduce additional systems – all with different methods of tracking sales tax. The differing systems can result in data that is inconsistent in format and content.

Businesses can spend a large amount of time consolidating and standardizing the data each month.  This includes data collection, validation, and manipulation.  All of this data review leaves little time to be spent on filing the returns, paying the jurisdictions, responding to jurisdictional inquiries and other more high value activities such as tax planning and research.

Finance and accounting departments need to step in early to support systems projects in order to optimize the information and output they need.  Often times tax information requirements are overlooked in favor of financial information.  Assigning a resource to systems project teams (with sales tax in mind) can help eliminate the issue and ensure that data can be easily produced for all required tax purposes.  Furthermore, consistently formatted data not only streamlines the internal return preparation process but can facilitate a sales tax outsourcing relationship as well.

 

Anne Birkmann

Written by Anne Birkmann