Why your amounts might differ from Global Tax Determination
How Global Tax Determination calculates gross amounts
We want to make sure that the appropriate and most up-to-date tax rate is applied during the tax calculation. That's why Global Tax Determination takes your tax amount and works backward from it by applying the tax rate stored in the Global Tax Determination software and adding any exempt amount. You can compare the gross amount resulting from this calculation to the one in your books. If the numbers don't match, read on for the possible causes. If the difference makes sense and you're comfortable moving forward with the return, you can do so; if not, you should contact your Managed Services team for more information.
Common reasons why your gross amount may be different
- Rounding
- Most of the time, Global Tax Determination rounds to the second decimal only. If your company uses a different rounding method, there might be a slight difference in the gross amounts.
- Different tax rates
- The tax rate determined by the software your company uses can be different from the tax rate applied by Global Tax Determination. Global Tax Determination is a highly dependable source for tax rates that includes thousands of unique product codes and industry-specific product types and scenarios, including variables like caps and thresholds, drop shipments, tax holidays, and project exemptions.
- Exemption issues
- You applied an exemption but Global Tax Determination couldn't find the transaction eligible for exemption.
- Missing transaction data
- Not all transactions in your ledger were uploaded to Global Tax Determination.
- Date types don't match
- You might be looking at the gross amount in your system based on a date type that's different from what was set up in Sovos Filing. For example, you could be looking at transactions based on tax point date, while the Sovos Filing calendar uses the invoice date.