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What Accountants Should Consider When Evaluating Sales Tax Software

by Courtney Touchstone

sales tax tips for accountants

Running an accounting business with eCommerce clients has become exponentially more complicated since the 2018 Supreme Court ruling on the South Dakota vs Wayfair case. Now that each state has jurisdiction to make and enforce its own rules regarding sales tax, staying abreast of these requirements is a time-consuming task. Accounting businesses, no matter how small, can greatly benefit from an automated sales tax software to manage their clients’ sales taxes. 

Choosing the right sales tax software can enhance your client relationships and increase your revenue. When you’re ready to automate the task of managing all of your clients’ taxes, there are many topics you should consider. Here are a few things to make note of when selecting a sales tax software for you and your clients:

  1. Perform a needs analysis

Perhaps the most important analysis you will do when selecting a sales tax solution is to gain a complete understanding of exactly what you and your clients need. Create a comprehensive list of the platforms where your clients are currently selling, where they intend to sell in the near future, as well as any other software that will be important to integrate with. There are hundreds of integrations with eCommerce platforms available, but if your clients are only doing business on a handful of those, why should you pay more for a solution with features you will not use?

  1. Cost and billing structure

When evaluating products, pay attention for any added costs or fees that may be charged such as setup or cancellation fees. Many sales tax software companies will provide a free trial period for you to test out their software. If a trial is not offered by the software you are considering, this should be a red flag. Billing structure is also something you should consider upfront. Would you prefer to handle the software costs on behalf of your clients or have them billed directly by the company? Ideally, the product you select should have the flexibility to handle both situations. 

  1. Ease of implementation and management

Although price is important, functionality is paramount. Most systems are easy to use once you become familiar with the user interface, you don’t want to find out too late that the software you have selected is difficult to navigate and manage. This is especially important for tasks like onboarding new clients and connecting their store integrations. When evaluating a solution, make sure to understand how many steps are typically required when onboarding and the average time it takes to integrate a new eCommerce or payment platform. When you are managing all of your clients in a system, the time these processes take quickly adds up. 

  1. Client management 

You should also be sure to consider how hands-on you plan to be once your clients are onboarded with the sales tax software. Some software solutions work on a bounty system where you are rewarded for turning your customers over to a company. This can be a nice financial incentive for referring clients, but you may prefer to manage your clients directly. At TaxJar, we advocate for the latter. After all, you are your clients’ trusted advisor. Although we are here to help you facilitate their state and local taxes, they trusted you with their business and likely expect you to be hands-on. 

  1. Educational resources

Even after you select a sales tax software, your clients will still expect you to be the expert on sales tax. Keeping up with constantly shifting sales and local sales tax legislation is a daunting task, so it’s important to look for a partner who will invest in you and your education by enabling you with ongoing training and resources. Ensure the company truly stands out in their knowledge and understanding of sales tax legislation and freely provides up-to-date information that displays a constant monitoring of the industry. Ideally, select a company who is proactively providing you with updates on new legislation or webinars to keep you informed. 

  1. Reputation

Your clients selected you as their tax advisor because they trust you and respect your reputation. It’s incredibly important to ensure the tax software company you are working with has the same stellar reputation you’ve worked hard to build and maintain for your own business. Not only will you be entrusting your clients’ business in the hands of the company you select, but to an extent you are staking your personal reputation on the experience your clients have with this partner. To make the right decision, it is best to read reviews and gain a comprehensive understanding of the experiences others have had with each company you are considering. 

  1. Customer Service

The quality and availability of technical support and customer service are critical pieces to consider when selecting sales tax software. If something does not look right in a client’s account, you want reliable, helpful and forthcoming customer support responding to your request. As you are evaluating companies, be sure to ask about the average time it takes to get a question answered by their technical support. Also, be sure to review the support documentation available online to ensure it is thorough and easy-to-understand. 

These are just a few of the things a tax advisor should consider when selecting sales tax software. Are you ready to begin evaluating a sales tax software company? Learn more about TaxJar’s client management solution built specifically for tax advisors, TaxJar Pro

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