Five mistakes teams make with tax calculation

It comes up on almost every project, usually later than it should. These are the ones we run into repeatedly when we audit tax calculation.

Trust does most of the selling online, and trust is built from unglamorous details. If it only works because one person remembers to do something, it does not work yet.

Warning signs

• Treating it as a launch task rather than an ongoing one
• Assuming someone else already owns it
• Rules differ by destination and change without warning
• Getting it wrong is a compliance problem, not just an accounting one
• Never checking whether the fix actually worked

Automate it rather than maintaining tables by hand. In practice this is a scheduling problem more than a technical one. Check it against what you would want a competitor's site to get wrong.

Turning this into a decision

In practice

In e-commerce every friction point has a price attached, and the arithmetic is unusually easy to check. Three things worth confirming about tax calculation before you move on:

• Someone can say what the current setup is without going to look
• Automate it rather than maintaining tables by hand — and you know whether that is true here
• There is a way to tell whether the last change to this helped

If you are not sure where your systems currently stand on this, it takes us about an hour to find out.