Three sales tax best practices for high-volume sellers
by April 29, 2025
High-volume sellers face unique challenges when it comes to sales tax compliance. Due to the large amount of sales across states, these businesses have to contend with multiple tax jurisdictions and varying compliance requirements. Throw in large and diverse product offerings, and you can see why as your business grows, basic sales tax strategies are no longer sufficient.
This blog post explores three sales tax best practices that can help high-volume sellers streamline processes, enhance accuracy, and mitigate risks as they navigate the complexities of sales tax compliance.
1. Leverage automated solutions
One of the most effective and popular ways to manage sales tax for high-volume sales is through automation. Utilizing sales tax software can help automate calculations, collection, and filings across multiple sales channels. These tools integrate seamlessly with your e-commerce platforms, accounting systems, and marketplaces to ensure accurate tax collection and reporting.
Key benefits of automation:
- Scalability: Automated systems can handle increasing transaction volumes without causing a disruption to your checkout experience.
- Accuracy: Avoid manual sales tax calculations and reduce the risk of human error.
- Real-time compliance: States update their sales tax rules and rates often. An automated sales tax approach ensures that your business remains compliant with changing tax laws.
- Unified multi-channel sales tax management: Consolidating all the sales tax collected into one dashboard, provides you with a comprehensive view of your tax obligations.
2. Tailored exemption certificate management
Navigating tax exemptions can be tricky, especially for businesses that serve various customers, including non-profits, resellers, and industries that qualify for tax-exempt sales. A tailored exemption certificate management strategy can help high-volume sellers maintain compliance while maximizing approved exemptions and supporting customers of all types.
Key benefits of certificate management:
- Accurate documentation storage: Implement a procedure for collecting, verifying, and storing exemption certificates to support compliance.
- Facilitate regular review: With an exemption certificate management strategy, you can periodically audit your exemption certificates for validity, flagging expired certificates for renewal or further review.
A sales tax solution like TaxJar can help manage exemption certificates, by allowing businesses to upload and store certificates to ensure compliance.
3. Advanced sales tax reporting
To make informed decisions regarding sales tax, high-volume sellers must leverage advanced reporting. By analyzing sales data across jurisdictions, you can identify trends, understand tax liabilities, and make proactive adjustments to your sales tax configurations.
Key benefits of advanced sales tax reporting:
- Analyze sales trends: Access insights to identify where sales are increasing, as this may indicate you’re approaching nexus in a new state and need to take steps to register for a permit.
- Prepare for tax liability: With comprehensive reporting you can outline your expected tax liabilities for each state based on sales data, helping you budget effectively for tax obligations and collect the correct amount of sales tax.
TaxJar’s reporting dashboard gives you a full picture of sales tax activity for your business. Our platform automatically updates data every day, so you can see how much tax you’ve collected to date, or the expected amount due, for each state where you have nexus, as well as when your next payment is due.
How to stay compliant as your business grows
Effective sales tax management is crucial for high-volume sellers to succeed in the competitive e-commerce environment. Implementing advanced configurations, such as automation, tailored exemption management, and advanced reporting, can streamline sales tax processes and enhance compliance. By investing in these strategies, businesses can navigate the complexities of sales tax, support growth, and sustain success as they scale.
Want to see how TaxJar can support your business? Sign up for a free trial of TaxJar today.
