Navigating Sales & Use Tax w/ Microsoft Dynamics & CCH. Andrew Phillips. Channel Sales Representative, Corporate. May 2, 2014

Transcription

1 Navigating Sales & Use Tax w/ Microsoft Dynamics & CCH Andrew Phillips Channel Sales Representative, Corporate May 2, 2014

2 May 2,

3 Sales & Use Tax Today s Climate May 2, USA 3

4 Sales & Use Tax in 2014 Why We Need Help? May 2, USA 4

5 Sales & Use Tax in 2014 Why We Need Help? 46 States 10,000 Jurisdictions Thousands of Product Categories 160+ Shipping Rules Min/Max Tiers Sourcing Rules Origin / Destination / Both 340+ Forms To File Tax on TAX May 2, USA 5

6 Why Sales & Use Taxes are Important Account for more than 20% of state and local government revenue 2014 collections expected to top $1.2T Uncollected revenue from e-commerce estimated in excess of $30B - $50B per year Planning opportunities to mitigate virtually nonexistent

7 State Tax Revenue Shortfalls May 2, USA 7

8 Sales Tax DEFINING SALES TAX Transactional tax on the sale TPP (Tangible Personal Property), services and other where the buyer and seller are located in the same state Usually imposed on the transaction Usually levied on the consumer Usually collected by the seller Different types of sales tax labels Retail, Vendor and Consumer Sales Tax Transaction, Privilege, and Retailer s Occupation Tax May 2, USA 8

9 Use Tax DEFINING USE TAX Transactional tax assessed on the storage, use or consumption of TPP, services and other, where a sales tax was not imposed by the seller Use tax transactions generally takes place when the buyer and seller are located in different states Primary difference between a sales tax and use tax is the imposition of a local tax rate In states were there are differences, sales tax transactions have the higher tax rate Administration of use tax - Seller s use tax seller collects, reports and remits to state Consumer s use tax buyer reports and remits to the state May 2, USA 9

10 Sales & Use Tax Topics for 2014 Expanding Nexus Statutes Marketplace Fairness Act 2013 Expanding Taxable Bases Exemption Certificate Support Consumer Use Tax Reporting May 2, USA 10

11 Expanding Nexus Statutes Click-through-Nexus Amazon Law NY Click-thru nexus law passed in Affiliate with more than $10,000 CA law in effect Sept 2012 Amazon agreed to settlement CA law applies to out-of-state retailers that have sold more than $1 million to California consumers in the past year and have had more than $10,000 in sales referred by an affiliate in California. CURRENT Kansas Kentucky North Dakota New York Texas Washington North Carolina California (Sept. 2012) PLANNED Indiana (Jan. 2014) Nevada (Jan. 2014) New Jersey (July 2013) South Carolina (Jan. 2016) Tennessee (Jan 2014) Virginia (Sept 2013) May 2,

12 Marketplace Fairness Act of 2013 Quill Corp. v North Dakota (1992) Quill Corp office supply company No physical presence in ND State argued floppy disk created nexus under due process State Supreme Court backed department US Supreme Court ruled physical presence required to impose tax Congress can overrule via legislation Introduced to Congress on February 14 th 2013 $ billions lost annually 4th time being presented Identical bills introduced to House and Senate Bi-partisan support in both houses Seeks to take advantage of clause in Quill v ND May 2,

13 Marketplace Fairness Act of 2013 States Collect from Remote Sellers Does not affect nexus Barriers to collect remote tax must be lifted Small seller exemption <$1Mil Applies to Sales & Use Taxes only Remote Sellers In state rules do not change Promotes Fairness Online retailers & brick-and-mortar States must simplify sales tax MFA Large Corporate Support Amazon, Best Buy, Barnes & Noble, Gap REI, Sears, Target, Wal-Mart Home Depot, J.C. Penney May 2,

14 Expanding Taxable Bases Expanding Taxable Bases Many States have added Services to their Taxable base Digitally Delivered Products/Services Sin Foods & Products Professional Services Consulting Services Warranty/Repair Services May 2,

15 Exemption Certificate Support Exemption Certificate Support Exemption Types Requiring Certificates Resale Government Manufacturing Educational Religious and charitable Organizations, etc. Requirements Proof of valid certificate Meeting state specific requirements (info, dates etc.) Auditors using more objectivity in their review of certificates May 2,

16 Consumer Use Tax Reporting Untaxed purchases can create huge tax exposure - 1) Office equipment and supplies 2) Fixed & mobile Assets Machinery and equipment that do not qualify for manufacturing exemptions 3) Bulk purchases shipped to a central location and re-distributed 4) Items pulled out of inventory and used for internal consumption 5) Marketing & Promotional and sample products given away free of charge where no tax was paid on the original purchase May 2,

17 What is Your Exposure? What creates tax exposure in the sales & use tax world? Not remitting tax when you have a legal obligation (nexus) Not remitting tax on taxable transactions (taxability) Not remitting enough tax on taxable transactions (rates) Not remitting tax that you have collected (foolish) Not self-assessing and remitting consumer use tax if required (taxability) What about over collection of tax? Imposing tax on non-taxable transactions Applying an erroneous tax rate May 2,

18 Sales Use & Tax Audits May 2, USA 18

19 How are you handling it today in GP? Initial research of rates Updating rates Manual creation and update of tax detail and schedules Line item taxability Reporting Address Validation Sourcing Data Exemption Management Complex Calculation Multi State Exempt Certificates Tier Taxes/Max Taxes May 2, USA 19

20 Are your addresses accurate? Tax Jurisdiction Determination: Which is the correct tax jurisdiction? Geospatial level of accuracy Special Tax Districts Districts Coverage Address validation May 2, USA 20

21 Calculation Front End Correctly Calculating Sales Tax What are the rates? State City County Special District What s being sold? Products/Services Taxability Exemptions Where s it being sold Nexus Address Validation May 2, USA 21

22 Compliance Back End Correctly Submitting Sales & Use Tax Returns Nexus- where are you responsible to file? How many? Home Rules Filing Frequency how often are you required to file? Monthly Quarterly Semi-Annual Annually May 2, USA 22

23 Exemption Certificate Management How Many Certificates do you manage? How do you keep up with expiration? May 2, USA 23

24 Best-in-Class Seamless Integrations with Dynamics ERP Address Validation Advanced Situs Rules, ship-to, ship-from Custom Tax Schedules, Tax Holidays, Effective Dates Exemption Management Module Special Tax Districts Liability Reporting Comprehensive Quality Data General / Restaurant / Food Freight Rental Professional Services Customizable Tax Matrix Seamless Integration to Tax Returns Solution Implementation Schedule May 2, USA 24

25 YOU HAVE OPTIONS!!!! May 2,

26 Sales Tax Load Utility GP CALCULATION Automatically creates tax detail for each jurisdiction Creates all required tax summary schedules to zip code Assigns summary/tax code to all customer & vendor records Updated monthly Available is state subsets as well as whole country Native GP Calculation Little IT resource May 2,

27 In the Office Sales Tax Office On Premise Server based Sales Tax calculation engine (Unlimited Transactions) Seamless Integration GP , 2013 AR/AP/Projects Address Validation with Geospacial Solutions Advanced Situs Rules, ship-to, ship-from Custom Tax Schedules, Tax Holidays, Effective Dates Robust USE TAX Module Pre Built Reports Data Export to Returns Solution May 2, USA 27

28 In the Office Sales Tax Office (continued) Exemption Management Module Special Tax Districts Liability Reporting Multiple standard reports Comprehensive Quality Data by CCH General Freight Rental Professional Services Customizable Tax Matrix Seamless Integration to CCH Tax Returns Solutions May 2, USA 28

29 In the Cloud Sales Tax SaaS Cloud Solution - automatically updated sales tax rates for every taxing jurisdiction in the United States, its territories and Canada. Hosted by CCH, SalesTax.com Integration for GP 2010 & 2013 STS Certified Pre-programmed taxability rules, researched and maintained by CCH. Liability Reporting Exemption Management Easily account for returns and losses. May 2, USA 29

30 In the Cloud Sales Tax SaaS (continued) Address Validation w/ Zip +4 Launch the web dashboard from within your Dynamics GP to view transactions, run reports and modify settings. Sales Tax Returns Filing in same dashboard! One Login for calculation and tax returns! Comprehensive Quality Data by CCH General Freight Rental Professional Services Customizable Tax Matrix May 2, USA 30

31 SALES TAX RETURNS TIME AGAIN! 31 May 2, USA 31

32 Compliance Outsourcing Turn key Tax Filing Cloud based Preparation of Returns Prebuilt Data Feed Total liability approved via Client Dashboard Provider files and remits returns One payment Transfer Always be on time! May 2, USA 32

33 Returns Outsourcing Compliance Compliance Outsourcing Dashboard May 2, USA 33

34 Forms Solutions (want control?) Automate the preparation of your sales and use tax returns Cloud solution Send data file(s) Maps all data and and performs all setup Signature ready returns Customer performs review, edit and approval functions EDI, print and web filing 20+ Electronic Returns All state, county & local May 2, USA 34

35 Automated Returns with Returns Online May 2,

36 Sales Tax Professional Services Onsite and Remote Installation Onsite and Remote Training Project Manager on Engagement Go Live Assistance Custom Tax Research Tax Workshop Nexus Evaluation Registration Services VDA Assistance May 2, USA 36

37 Overview of CCH, Wolters Kluwer CCH Tax And Accounting is the worlds largest provider of tax content and software for the tax and accounting industry Large division of Wolters Kluwer ( 4.5 billion annual) Researching tax law since 1913 Over 1,000 researchers on staff 30 full time researchers keep up with Sales & Use Tax changes/law Launched a Sales & Use Tax Solutions Division in 1999 Microsoft Gold Partner since 2005 Microsoft Dynamics ERP Integration Options AX CfMD GP NAV CfMD SL May 2, USA 37

38 It s true. We live and breathe this stuff! Actual car of Product Manager! May 2, USA 38

39 CCH Sales Tax Returns Online (want control?) Automate the preparation of your sales and use tax returns Cloud solution Send data file(s) to CCH CCH maps all data and and performs all setup Signature ready returns Customer performs review, edit and approval functions EDI, print and web filing All state, county & local Questions? May 2, USA 39

40 Contact Us Want to talk Sales Tax & Dynamics? SalesTax.com Andrew Phillips May 2, USA 40