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Entrepreneur Tips and Discussions

Startups and Tax

Hey

Recently been looking into various tax situations and obligations based on various potential startups and business models and have been surprised at the lack of clarity or some form of streamlined solution which allows small & medium businesses and startups to ensure they are covering the necessary bases when it comes to tax.

What seems to be particularly complicated to me is paying tax in foreign territories i.e. a UK company selling to US consumers and navigating US sales tax, the various situations in which you may have Nexus in a state and therefore be liable to pay taxes there. Similarly with a US based startup selling to UK or EU consumers ensuring they are VAT compliant. It’s something which seems to be further complicated by whether you are selling a physical product, a service or some kind of digital good or service or SaaS.

I appreciate that most of the time, founders/business owners will probably just consult a tax professional, however I’m surprised there isn’t something like a SaaS solution whereby when you’re setting up your company, you detail your HQ i.e. UK, US, France, Germany etc + where your customers are/what markets you are selling to and it can advise you on the neccasary steps you take to ensure you are tax compliant. One thing which does seem like a positive is the ‘Streamlined Sales Tax Registration System’ which I think has just over 20 states currently signed up, allowing you to register for sales tax for each of states in one simple application.

I’d be grateful if anybody knew of anybody doing anything in this space already and could point me in the right direction, otherwise it seems like there is some kind of void for a SaaS solution which allows SME’s and Startups to simplify being tax compliant both domestically and abroad as well as other areas perhas such as data protection etc



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