, ,

Keep Your Company Safe from Audit Risk While Adapting to COVID-19

March 31, 2020

Tax compliance has always been a balancing act – directing available energy and resources on those activities and solutions that will do the most to keep your company safe from audit risk. While the challenges may differ (as resources may be less available to some businesses during the COVID-19 pandemic) the obligation of tax professionals remains the same – doing what they need to do minimize risk.

Understanding what you can do help and where you should be directing your compliance energy at this time is an important first step. For the last several weeks, Sovos has been busy compiling and providing time sensitive and valuable information regarding changing sales tax determination, collection and remittance obligations as a direct result of the COVID-19 pandemic.

This includes real-time data on jurisdictions offering filing and remittance extensions to inform you as to what returns are due “right now” and what returns may be put aside for a few days or weeks. This data enables effective near-term priority setting within your compliance team.

Business Change Driven by COVID-19

The business landscape is changing quickly. Every day governments are issuing new directives on which businesses are deemed essential and may remain open and how they must go about conducting operations.

A couple recent examples of business change that will have an impact on taxes and reporting include:

Paper and Plastic Bags at Checkout – Bringing your own bags to the grocery store has been a staple of the environmental movement over the past decade. Similarly, state and local governments across the country have enacted either outright disposable bag bans or impose fees on customers requesting disposable bags at checkout.

Many jurisdictions have opted to remove those bans and suspend bag fees, including locations in Alaska, Colorado, Connecticut, Illinois, Maine, Massachusetts, Minnesota and Ohio. We fully expect additional jurisdictions to follow suit over the next several weeks.

Adapting to Social Distancing – Many national retailers (including some Sovos clients) have begun to offer curbside pickup/delivery services, meaning that a customer may call ahead (or use the store App) to place an order and have the items delivered directly to their car when they arrive at the store.

If your organization offers this service for a fee, be sure that you are considering the proper tax treatment? This could be especially tricky if the order includes both taxable and exempt items, for example food and paper products.

These are just a couple of small but poignant examples of how COVID-19 is changing the rules for businesses and how ensuring tax compliance has become more complex than ever. With everything that businesses must worry about during these challenging times, an audit should not have to be one of them.

Be sure to continue to monitor the feed for changing regulations due to COVID-19 that could impact your business and please, stay safe.

Sign up for Email Updates

Stay up to date with the latest tax and compliance updates that may impact your business.



Sovos was built to solve the complexities of the digital transformation of tax, with complete, connected offerings for tax determination, continuous transaction controls, tax reporting and more. Sovos customers include half the Fortune 500, as well as businesses of every size operating in more than 70 countries. The company’s SaaS products and proprietary Sovos S1 Platform integrate with a wide variety of business applications and government compliance processes. Sovos has employees throughout the Americas and Europe, and is owned by Hg and TA Associates.
Share This Post

North America Tax Information Reporting
June 7, 2023
4 Ways to Elevate Your Direct State Reporting Process

Direct state reporting obligations have gotten increasingly difficult for some businesses over the past few years. With more states requiring direct reporting of form series 1099, more companies are subject to penalties if they do not comply with those obligations. As state reporting evolves, ensuring your process is efficient is critical. Strengthening your reporting process […]

EMEA VAT & Fiscal Reporting
June 7, 2023
The Value of SAP S/4HANA Add-On Software Certification

Many companies utilise SAP for their tax processes, but limitations in native software functionality add a layer of complexity. Custom coding is often required for businesses to achieve their desired results, producing the need for ongoing customisation and optimisation – this creates a hefty burden for companies, in addition to their tax compliance obligations. SAP-certified […]

North America Sales & Use Tax
June 5, 2023
Sovos Onboarding: 6 Departments Dedicated to Customer Success

If you are evaluating Sovos, we want you to understand expectations for the customer experience and what teams are there to support you. At Sovos, we have a range of teams ready to support you from the day you sign a contract. Whether it be a customer success representative to review the value you are […]

North America Sales & Use Tax
June 1, 2023
3 Things to Remember if You Get a Sales Tax Notice

Have you ever received a sales tax notice from a state department of revenue? Whether you answered yes or no, there are important things to keep top of mind to help keep your business prepared. Finding out that you have failed to comply with one or more of your sales tax obligations can be startling. […]

EMEA VAT & Fiscal Reporting
May 31, 2023
Bizkaia: What is Batuz LROE?

The Ledger of Economic Operations (Libro Registro de Operaciones Económicas), also known as LROE, is a main compliance element of the Batuz tax control system. This system is under implementation in the province of Bizkaia, located in the autonomous Basque community in Spain. Taxpayers under the Batuz mandate must comply with both TicketBAI and LROE […]