Best Sales Tax Software for Small Business

Looking for the best sales tax software can be challenging for small business owners. You have to consider a range of features, ensure the software is compatible with your existing systems, and find something that fits your budget. 

And, this all needs to be done while keeping up with changes in tax laws. The ideal choice can make managing our businesses easier, saving time and preventing costly tax-related mistakes. The question is, how do we identify the best automated sales tax solution for our needs?

We’ll discuss the best sales tax software options below, along with other things worth knowing about sales tax solutions.

Top Sales Tax Software Options for Small Businesses

You're in the market for the best sales tax software, and it's essential to know how they stack up against each other. We’ll explore the standout features, usability, and cost-effectiveness of the top contenders.

You'll also get insights from expert opinions and user reviews to ensure you make an informed decision that suits your small business's unique needs.

The top contenders when evaluating sales tax software are Avalara, TaxJar, and Zamp. Let’s look at each one individually.

Avalara

Avalara is a provider of cloud-based tax compliance solutions, focusing on automating the processes of sales and use tax calculation, filing, and remittance for businesses operating across multiple jurisdictions. The software is designed to integrate with a variety of business systems and manage tasks such as tax rate determination, exemption certificate management, and return preparation.  While it offers features like a user-friendly interface, Avalara falls short when considering both pricing and support. 

Read our in-depth comparison: https://zamp.com/zamp-vs-avalara/

TaxJar

Following Avalara, TaxJar emerges as another player in the cloud-based tax compliance landscape, focusing its offerings on e-commerce businesses. TaxJar helps business owners manage sales tax by automating calculations, reporting, and filings. The software integrates with a variety of e-commerce platforms and payment processors and aims to simplify the monthly reporting process.  TaxJar lacks phone-based customer support, offering assistance solely through a contact form submission. This setup may not be ideal for business owners requiring immediate resolution of issues.

Read our in-depth comparison: https://zamp.com/zamp-vs-taxjar/

Zamp 

Zamp has a distinct approach to pricing, offering a clear, single rate without hidden fees or surprises. This straightforward pricing model is complemented by integration features with multiple e-commerce platforms, simplifying the tax compliance process for businesses operating across multiple sales channels.

Zamp is known for its precision in collecting sales tax, guiding businesses on where they need to collect sales tax, and registering them in all necessary states. This software also provides state-specific sales tax reports and filing. Onboarding is designed to be quick and personalized, reducing the time it takes to get up and running.

Unlike Avalara and TaxJar, Zamp has an in-house customer support team that’s available by phone or contact form. With responsive support, Zamp is well positioned as a hassle-free solution to sales tax compliance.

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Expert Opinions

While Zamp offers compelling features for small businesses, it's essential to consider what industry experts and existing users say about their experiences.

“We want our team’s full focus on creativity and growing the business. Not sales tax and the latest notices from 15 different states. Zamp’s managed solution is unique as they really do it all. Moving over to Zamp from our previous provider was a no-brainer." - Allen Shafer, Co-Founder of Fulton & Roark.

"I provided Zamp with my existing registration information and they set everything up for me. My advice to other businesses is to get started with Zamp right away." - Kate Savage, Digital Marketing Manager at Otteroo.

"Their team made sure we weren’t double remitting taxes that the social platform already collected. I trust them to keep our business compliant. And if anything ever comes up, I know they are just a phone call away." - Andy Nalla, CEO of Ghost Golf.

"At Amped Bikes, our passion is motorsports. We operate in a lean, high-growth environment. When it comes to sales tax, Zamp is the perfect partner as they take care of it all so we don't have to worry about it." - Amy Dalley, Co-Founder of Amped.

Zamp's streamlined onboarding process aims to make your setup effortless. Here’s what you’ll need to get set up:

• Your company's basic details, including the company name, address, and the states where you operate
• The bank account and routing number for the account you intend to use for sales tax payments to the states
• Your current sales tax registration details for each state you're registered in, including the registration number, and your login credentials
• A description of the products and services you offer

As you can see, Zamp’s onboarding process will allow you to get up and running quickly.

What to Know About Sales Tax Software

While we’ve discussed the best sales tax software for small businesses, there are some additional things worth knowing. We’ll cover what sales tax software is, how it works, and the overall benefits of sales tax software.

What Is Sales Tax Software?

Sales tax software is a digital solution created to help small businesses charge, collect, report, and submit sales tax. This type of software automates the calculation of the correct amount of sales tax to charge on goods or services based on customers' and businesses' locations.

How Do Sales Tax Software Solutions Work?

Sales tax software is meant to simplify and automate managing sales tax data. It typically works by:

• Integrating with software. The best sales tax software connects to a company’s sales systems, like Shopify or Stripe, or bookkeeping software and accesses the required state tax information automatically.
• Determining product taxability. Every product or service is taxed differently. Sales tax software should identify which items are taxable and at what rate. This is especially important for businesses that sell a variety of goods and services or sell on multiple platforms.
• Automatic and location-based calculation. Sales tax software should automatically calculate sales tax rates by state and tax jurisdictions. It should use the customer’s delivery or billing address to determine the exact tax rate that applies to each sale.
• Reporting and state filing. The best software for small businesses compiles and calculates the total sales tax that the business owes for each tax period.
• Updates and compliance. It’s no secret that tax laws and rates change frequently. Sales tax prepares automatically update their systems to reflect these changes, allowing businesses to stay compliant without needing to worry about changing laws from tax authorities themselves.

In-house tax professionals. While the software is important, having tax professionals that can maintain it and work with you is just as vital. One of the best companies for small businesses that offers hands-off onboarding is Zamp. We configure your client account to save you time and ensure that everything is done right from start to finish.

Understanding the Benefits of Sales Tax Software

It's important for small businesses to understand and comply with sales tax regulations to avoid fines and stay on the right side of the law. Managing sales tax compliance is a shared challenge among small businesses and is essential for operating successfully within the wider business ecosystem.

The best sales tax software serves as a support to your team. Designed to reduce the hassle of tax calculations, filings and payments, sales tax software keeps your business in compliance with the ever-changing sales tax rates and legal requirements.

You'll want to identify the key features that top-rated solutions offer to ensure you're getting the best tool for the job. Let's examine how the right tools can boost your business's efficiency and ensure you're following tax laws correctly.

The best sales tax software offers accurate tax rate determination, integrates seamlessly with your sales platforms, and automates filing and remittance. It's there to streamline your workflow and keep you in the loop with real-time reporting.

You'll also want a system that not only simplifies nexus determination but also provides you with a supportive network of experts.

Finding the Best Sales Tax Software for Your Business

Having explored the various benefits of sales tax software, it's clear that picking the right system is key to maintaining compliance and streamlining tax operations for your small business.

Before making a commitment, scrutinize your options to ensure the sales tax software you choose aligns perfectly with your small business needs. Take your time to compare features, ease of use, and customer support. Look for reviews from businesses similar to yours and consider how their experiences can inform your decision. 

Find the solution that resonates with your unique situation, and you'll set your business up for smoother sailing ahead. 

Sales Tax Software for Small Business: FAQ

The ideal sales tax software for small businesses should offer automatic tax rate determination based on location, seamless integration with accounting and e-commerce platforms, easy tax filing and remittance across multiple jurisdictions, and robust reporting tools. Additionally, it should provide a user-friendly interface that simplifies the tax compliance process for businesses with limited accounting resources.

About the author

Zamp Team

The Zamp Team consists of experienced writers and editors who are dedicated to researching sales tax topics to help readers make smart decisions about their business and sales tax compliance. Collectively, the team has over 200 years of sales tax experience.