Making sales tax less taxing. 1 Automating Sales Tax for Microsoft Dynamics GP Presented by:

Making sales tax less taxing. 1

Automating Sales Tax for Microsoft Dynamics GP

Presented by:

Making sales tax less taxing. 2

Agenda

1. Challenges of Sales Tax Compliance

2. Avalara AvaTax Solution Overview

3. Demonstration of Avalara AvaTax

4. Customer Experience

5. Q&A

Making sales tax less taxing.

Sales and use tax compliance

52% of accounting professionals agree: completing a marathon would be easier to accomplish

than understanding sales tax compliance laws.

Source: Wakefield Research 2013

Making sales tax less taxing.

When general sales tax and selective sales tax are combined, sales tax makes up 47% of total state revenue

Where do States turn for tax revenue?

Source: US Census Bureau, 2012 Census of Governments: Finance – Survey of State Government Tax Collections at www.census.gov/govs/statetax

Total State Government Tax Collections by Category

Other taxes 3.9%

Corporation net income taxes 5.3%

Total license taxes 6.8%

Total selective sales taxes 16.6%

General sales and gross receipts taxes 30.5%

Property taxes 1.6%

Individual income taxes 35.3%

Making sales tax less taxing.

100,000 + distinct taxability rules

Exempt Products

Exempt Organizations

Tax Holidays

Thousands of changes each year

State-provided info often missing, misleading, or wrong

Sourcing rules14,700+ distinct tax jurisdictions in North America

Nexus rules

Situs

E-commerce rules

Destination based

Origin based

Home Rule States

Hybrid sourcingZip codes don’t match tax jurisdictions

Sales Tax is Hard.

Making sales tax less taxing.

The state of our States

States are still recovering from the Great Recession

In 2013, 31 states projected budget deficits totaling $55 billion

NRF estimates $24 billion in sales taxes goes uncollected on the Internet

Therefore

As tax-collecting agents of the State(s), they are looking to your business to find more money

This increased focus creates compliance risk for you

Making sales tax less taxing.

States finding more sales tax revenueby broadening definitions of nexus Remote sellers can no longer assume that Quill v. North Dakota

means they don’t have to collect sales tax

Nexus-creating activities (examples):̶? Independent agents̶? Remote sales force̶? Affiliate Nexus ̶? Trade show participation

“Amazon Laws”̶? Cyber Monday, 2013: SCOTUS leaves NY click-through affiliate law in place̶? 11 States have already passed Amazon Laws

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Accuracy is EVERYTHING!• Sales tax is a complex statutory requirement

– It’s an involved process – calculate, report, return, remit– 11,000+ taxing jurisdictions– 100,000+ distinct taxability rules– Thousands of changes to rates, rules and boundaries annually

• Manual sales tax management:– It’s labor-intensive and costly– Leads to inaccurate results– 100% non-revenue generating activity

Making sales tax less taxing.

Manual sales tax management is time-consuming, risk prone, and expensive

Source: Wakefield Research, July 2013

Average total cost for businesses to manage a sales tax audit

Average time spent filing sales tax returns and remitting payment

11 hours per week

Percentage of businesses that believe a sales tax auditor would find a mistake

Making sales tax less taxing.

Sales and use tax compliance

Source: Wakefield Research 2013

44% of accounting professionals who’ve worked for a company that has been

audited – and decided to contest that audit – think the process is more stressful

than a divorce.

44%

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Cloud/Hosted Service

• Simple Installation• Simple training• No maintenance• Always up-to-date

Making sales tax less taxing.

Avalara’s capabilities continue to grow

Expanding IntegrationHundreds of integrations on all major commerce platforms

Improving TechnologyAdded support for Lat/Long, new REST API, UPC taxability, and high-availability cloud deployment

Avalara ServicesExpanded offering to customers with related applications

CONFIDENTIAL & PROPRIETARY |

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End-to-End Sales Tax Compliance

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PRODUCT DEMONSTRATION

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Microsoft Dynamics GP / Customer Maintenance

Tax Schedule replaced with

one word: AVATAX

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Microsoft Dynamics GP - Address Validation

Incomplete Address information

CORRECTED!

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Microsoft Dynamics GP / Sales Order – Tax Calculation

Taxability rules applied and tax

calculated automatically

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AvaTax Dashboard - Login

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Admin Dashboard

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Organization Tab

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Transaction Tab

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Reports Tab

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Returns Tab

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Customer’s Avalara Experience

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Questions & Contacts• Contact Information

– Matthew Patrick– Regional Sales Manager– [email protected]

– 724.301.7054

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