Apr 6, 2023 • 3 minute read
Setting up a Sales Tax Compliant Ecommerce Tech Stack
You don't want to wake up to a nasty bill from a state's revenue department. When setting up your ecommerce tech stack, following these do's and don'ts to keep your sales tax calculations and collections on track.

Setting up a Sales Tax Compliant Ecommerce Tech Stack

Selling online makes it easy to grow your customer base and sell more. With the right ecommerce tech stack, you can streamline inventory management, shipping, and payment processing.

What often gets overlooked when building the best tech stack for your business is sales tax compliance automation — and if you ignore the sales tax elephant in the room, you’ll likely wake up one day to a bill and nasty notice from a state.

Following a few do’s and don’ts will help you avoid hefty fines and unexpected bills so you can get back to business.

Do: Look for Sales Tax Software That Integrates With Your Ecommerce Tech Stack

Sales tax management should be simple. The best way to simplify your sales tax management is to use software that easily integrates with your current ecommerce tech stack. We’re talking a few clicks, and you’re done. You shouldn’t have to be a computer or accounting whiz to get everything set up.

Do: Make Sure You Calculate and Collect the Right Amount

Unfortunately, sales tax isn’t uniform across the U.S. Some states collect 6 percent, some 8.5 percent and some states don’t collect sales tax at all. Your business’ sales tax obligations can vary by state, based on your sales or transaction volume.

Rather than calculating sales tax yourself for each of the sales tax jurisdictions in the U.S., let sales tax software do the math for you. When added to your ecommerce tech stack, your sales tax software will figure out your nexus (or connection to each sales tax jurisdiction), calculate how much tax you need to collect, and collect the tax for you with each sale.

Don’t: Pretend Sales Tax Doesn’t Exist

You can’t be an ostrich about sales tax, no matter how tempting it is to bury your head in the sand. Sales tax generates a considerable amount of revenue for states and municipalities. And those states want their money.

If you don’t pay up, they’ll come for you. And it won’t be pretty.

Don’t: Stress About Your Ecommerce Tech Stack

We don’t mean to scare you—sales tax shouldn’t make you lose sleep at night or cause you to abandon ecommerce altogether.

With the right sales tax software in your ecommerce tech stack, you don’t have to stress or fret about collecting, filing, or paying tax.

Do: Use TaxCloud

To avoid getting on the wrong side of the tax person, you need to do three things: calculate, collect, and file sale tax correctly. TaxCloud does all three for you. We like to say we eat sales tax for breakfast because we’re tax geeks and sales tax is what keeps us going.

We created our sales tax software for growing companies and made it easy. While you can set up and use TaxCloud independently, we also have a team of TaxGeeks standing by, waiting to assist you however they can.

Sign up for TaxCloud today and get your ecommerce business set up for success.