Running a finance team in a rapidly expanding SaaS company brings a unique set of challenges, sales tax compliance often being one of them. While it may appear as a low-return task and end up at the back of the to-do list, it is a reality that uncollected sales tax from your customers could have you paying those taxes yourself further down the line, along with fines, charges, and interest. Typically, businesses hire and spend upward of $50,000 to $200,000 on consultants to manage security and compliance.
Here's the silver lining: tackling sales tax compliance is not as arduous as it may seem. Galvix offers a seamless way for SaaS businesses of all sizes to save time and safeguard future revenues by implementing sales tax compliance automation.
Navigating sales tax in the SaaS sphere
Sales tax compliance is an essential task for any business, but recent developments have made it particularly complex for SaaS companies.
With the digital economy on an exponential rise, governments worldwide are reshaping their tax policies to match the pace. All 50 U.S. states have laws obliging remote sellers to collect sales tax, and over 80 countries globally follow suit. These laws are diverse, ranging from the specifics of tax rates to defining the amount of economic activity that prompts sales tax obligations. Additionally, digital products, like SaaS, are subject to varying definitions.
Unsurprisingly, this creates a challenging labyrinth of tax rules for businesses to navigate. As a SaaS company, it's imperative to understand where your customers are based, how your product is classified and taxed in these areas, and whether you've hit the sales thresholds set by local governments to identify where you have sales tax obligations. The processes of collecting sales tax from customers, forwarding the collected tax to appropriate jurisdictions, and handling the associated paperwork can be overwhelming.
However, a more straightforward solution exists for modern finance teams: sales tax automation with Galvix.
The Galvix approach to sales tax automation
Sales tax automation starts by automatically scrutinizing your transactions to decide if and how sales tax should be applied. The sophisticated Galvix platform integrates every transaction from your billing system and remains updated with all the latest local sales tax regulations to evaluate taxability. Consequently, Galvix can calculate the sales tax on each transaction and apply it to the charge in real-time.
Yet, Galvix doesn't stop there. Once you collect sales tax from your customers, you must also submit those taxes to the relevant jurisdictions. Galvix calculates the necessary sales taxes and files your returns on your behalf. That way, you are free from dealing with confusing government forms and complicated payment systems.
Moreover, being a SaaS business, your revenue tech stack should be equipped to accommodate the needs of a rapidly growing software company. Here's where the synergy between Galvix and your billing system comes into play, making the checkout-to-billing process more straightforward and giving businesses a comprehensive view of their sales tax exposure while automatically adding the correct tax to invoices.
Galvix understands that the unique aspects of SaaS business models can be challenging for some sales tax tools to manage, especially when the aim is to implement sales tax without causing friction in your checkout and billing processes. Galvix is specifically designed for SaaS, offering additional functionality out of the box, including access to a team of SaaS sales tax experts.
Integrating Galvix for sales tax automation
Integrating Galvix brings sales tax automation directly into your billing system; no coding is needed.
Here is how it works:
- Connect your billing system to Galvix to import past transactions and instantly see your sales tax exposure.
- Enable Galvix to automatically calculate and add the appropriate sales tax to your invoices in real time.
- Monitor sales tax obligations, register in new jurisdictions, and approve sales tax returns from your Galvix dashboard.
With Galvix, most businesses spend less than an hour a month dealing with sales tax. Don’t delay - connect your billing system with Galvix today.
Sales tax compliance need not be a burden on your SaaS business, with more finance leaders saying tax and compliance is an increasing priority. Galvix offers a simple, efficient, and effective solution, enabling your business to focus on growth and innovation. Embrace automation and free up resources for higher ROI tasks. After all, the success of your business should not be overshadowed by the complexities of sales tax.
Experience Galvix today and see how it can simplify sales tax for your SaaS business.