Best practices for managing use tax compliance
If your business is collecting and remitting sales tax in the states where you’ve triggered nexus, you may think you’re meeting all of your tax obligations. But if you’re not factoring in consumer use tax, you may be making a costly mistake.
Consumer use tax is the counterpart to sales tax but comes into play under many different scenarios. The most common triggers for use tax are when a seller doesn’t collect sales tax on a purchase, collects the wrong tax, or something about how the good/service is used changes after purchase. In thse cases, tax is passed to the buyer, who may be required to pay use tax on the taxable items or services.
For individuals, use tax is hard for a jurisdiction to enforce. But businesses face much more scrutiny and typically have stricter reporting rules. As a result, they’re more likely to be audited for use tax. To add to the complexity, the rules around use tax vary wildly from state to state.
Learn more about when your business may be on the hook to pay use tax and how to manage this complicated issue in our upcoming webinar. Join use tax expert Will Rau as he reveals:
As Avalara’s champion for all things Consumer Use Tax, Will Rau is launching a new service to simplify and automate liability self-assessment and reporting. In his five years with Avalara, he's significantly advanced their connector capabilities, overseen the introduction of India GST to Avalara’s portfolio of solutions, and is currently guiding, shaping, and expanding all of Avalara’s Consumer Use Tax efforts. William currently lives in Durham, North Carolina with his family.