Overview
Prepare your business and customers for a smooth and successful path to compliance, covering the practical issues to consider when implementing a tax solution.
Action items (optional)
- Notify your existing customers that you will start charging tax.
- In the US - Collect exemption certificates from applicable customers.
- For non-US business customers - Collect VAT IDs.
- Update your help center to guide your customers on how tax is calculated.
Notifying your existing customers, collecting VAT IDs and exemption certificates
SaaS businesses are built on strong customer relationships and recurring billing events. In order to maintain this strong relationship, we suggest pre-emptively reaching out to your customers and communicating your plans to use Anrok as a global tax solution. It is also helpful to find out if any customers are tax-exempt or for international customers whether they have a VAT ID so that information can be recorded in Anrok and tax correctly charged on the first transaction.
Below is an example communication that your business could consider:
"Starting on [Date], [Company] will collect applicable [state and local sales tax, VAT, GST] taxes on each invoice. This will not affect invoices prior to this date.
If you are receiving this email, you are listed as your organization’s primary billing contact. Please check your payment details to make sure your information is accurate and up to date regarding your organization’s location as it will impact the amount of tax you are charged. If your organization has a VAT ID, is tax-exempt, or qualifies for an exemption, please send us your information and a copy of your valid tax exemption certificate where applicable."
Update your help center
Additionally, we would recommend that you add additional content to your customer support site to help your customers understand why tax is being charged, how tax is being calculated and what to do if the customer is tax-exempt or has a VAT ID. Adding this content to your customer support site can help your customer better self-serve their inquiries into how to answer questions about tax charges. Refer to our playbook "Communicating sales tax changes to your customers" for more information.
As with any important project, preparation is a critical step to success. Implementing a global tax solution when your business is still small can help reduce the amount of time and effort required for preparation while change management is easier to execute. Regardless of size, Anrok can help your business grow by guiding you through the process of getting global tax implemented for your business.