If you’ve outsourced your sales tax compliance work, or are considering outsourcing it, you should determine the best way to transfer your tax data to your service provider each month.


The two main criteria to consider are the size of the file(s) and the sensitivity of the data in the file(s). Many companies that have smaller file sizes (< a couple of MB’s) and aren’t concerned with the sensitivity of the data can utilize traditional email to transfer their file(s) each month. However, certain file sizes will be rejected by an email server and the data security can be lacking via a traditional email transfer.

In these situations, you should consider the use of FTP (File Transfer Protocol) to transfer large files over the Internet.  FTP is a file server that holds large files for downloading by other computers.  Files are uploaded to the server and then available for download by others on the same network. Advantages include:

  • Download and transfer can happen simultaneously for multiple files; no need to transfer one file at a time
  • One of the fastest ways to transfer large files
  • Transfer can occur back and forth over the same server
  • More secure environment then email transfers – additional security can be implemented as well to encrypt the data transfer
  • FTP clients such as Filezilla simplify file transfers

Most sales tax outsourcing firms will have the ability to support either an email or FTP transport methodology. Be sure to ask and determine which option will be best for your business.

Anne Birkmann

Written by Anne Birkmann