Sales Tax Automation: Why Software Alone Can’t Ensure Complete Compliance and Risk Management

• Over-reliance on sales tax automation can lead to compliance gaps, as software cannot handle all aspects of tax management.
• Automation excels at calculating and applying correct tax rates across thousands of jurisdictions, but falls short in areas like tax calendar updates, nexus changes, and responding to state notices.
• Most software does not manage the entire sales tax process; many users report gaps in notice management, exemption certificate handling, and monitoring transaction thresholds.
• Human oversight is still needed for tasks such as detecting new nexus, updating filing frequencies, and responding to tax authority communications.
• Automation is a valuable tool, but cannot fully replace the expertise and attention required for complete sales tax compliance.

Source: taxconnex.com

Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.

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