These Sales Tax Filing Tips Small Businesses Like You

Sales tax filing has never been more complicated, but there are things you can do to make it easier for your small business. Here are some complimentary tips that’ll help you totally book those taxes!

Check Product Taxability

When you start selling a new product, you need to research the taxability laws in each jurisdiction where you have nexus. These laws can vary from state to state, so knowing what is taxable and exempt in each state where you plan to do business is essential.

Determine If Sales Tax Filing Needs to Be Done Electronically

Different states have different rules for how businesses can pay their taxes. Some states require companies to pay electronically, while others don't have the infrastructure to support that.

Knowing your state's payment options and requirements will ensure you pay your taxes correctly.


Determine If You Have Nexus in Another State or Jurisdiction

If you've expanded your business to include interstate commerce, you must be aware of sales tax filing regulations. These laws vary from state to state, but generally speaking, nexus is established when you have a physical presence in a state - for example, if you have an office or warehouse in the state, if you regularly deliver or install products in the state, or if you have employees working in the state.

Ensure All Checks to the Department of Revenue (DOR) Are Cleared

If you don't have a system for receiving and sorting documents, you might miss an important notice from the bank or the DOR. This could result in an outstanding sales tax balance. Review your process for receiving and sorting documents, especially if you have part-time staff. Do you know the essential documents lurking in your stack of papers or filing cabinets? Best to double-check for less challenging sales tax filing.


Ensure Your Payable Accounts Reconcile Through the Following

  • Find out how much is in your account at the beginning of the accounting period.


  • Add up the total amount billed to customers.


  • Subtract the total sales and use tax paid electronically or by check before the discount for timely filing.


  • Compare this amount with the current balance of your sales tax payable account.


  • If there is a difference, move any discount or rounding balances to the proper general ledger account.


Find Out If There Are Prior Sales Tax Filing Requirements

Some jurisdictions require businesses to pay taxes in advance, especially for large amounts. This might mean filing returns more than once a month on a different schedule than you're used to.

You'll need to keep track of multiple filing schedules if you do business in various jurisdictions with different prepayment requirements. Constantly update your calendar so you don't miss any important deadlines!

Schedule Your Sales Tax Filing Schedules on Your Calendars

Jurisdictions typically send taxpayers notices several months before their filing frequency changes. Still, if you don’t receive a notification, that doesn’t mean the new filing frequency doesn’t apply to you. Like the previous tip, always double-check with the relevant agencies and book the new schedules on an online calendar for all to see.


Get Help with Totally Booked

Need a hand with your sales tax filing? Get in touch with Totally Booked! We make financial aspects easier for your business by handling bookkeeping, budgeting, payroll, and much more! Find out how you can totally book your taxes with our help through our website!

Kelly Gonsalves