Catching Clouds, An Acuity Company
Results
Improved processes
Tax expertise
Increased compliance
Summary
Results
- Improved processes
- Tax expertise
- Increased compliance
Tax challenges
- Process inefficiency
- Tax complexity
- Compliance risk
Products used
Avalara Managed Returns for Accountants
Give your clients the benefits of a fully managed returns service while you offload the time and manual effort of providing it.
Benefits
- Met an increased demand for returns processing
- Offloaded tedious manual processes that took time away from growth initiatives
- Reduced the risk associated with manually applying rates across more than 13,000 sales and use tax jurisdictions
Industry type
Accounting
Company overview
Customer
Catching Clouds, and Acuity Company
Industry
Accounting
Tax type
Sales and use
In 2011, with decades of combined technology geekdom and accounting savvy between them, Scott and Patti Scharf formed Catching Clouds, a specialty ecommerce advisory firm providing sales tax management, controller and bookkeeping, payroll, and cloud accounting services.
As a part of their full virtual services, they also take care of paying bills, time and expense reporting, accounts receivable management, depreciation, reconciliation, and other accounting functions.
Since its founding, Catching Clouds has grown to a staff of more than 20 and serves clients with revenues from $1 million to $50 million. In 2021, Catching Clouds merged with Acuity to strengthen even further the commitment to ecommerce sellers.
Tax challenges
While sales and use tax automation is only one component of the services Catching Clouds offers, Scott says it was the most challenging because they have clients across the country and tax laws vary from state to state.
Then, in 2018, the United States Supreme Court’s South Dakota v. Wayfair, Inc., decision overruled a longstanding physical presence rule, allowing states to require remote sellers to collect and remit sales tax. With each state setting its own sales threshold for tax obligations, as well as rate and taxability rules, the impact on businesses was substantial.
Even though Catching Clouds had experience in state and local tax (SALT), trying to keep up with the increase in reporting requirements for thousands of jurisdictions was cumbersome and prone to error, translating to a higher risk of noncompliance and penalties.
Why Avalara?
In response to changes brought about by the Wayfair decision, Avalara introduced Avalara Managed Returns for Accountants, designed for firms to use on behalf of their clients. It helps practitioners start or grow a sales tax practice by automating the filing and remitting of sales tax returns. The system imports sales tax data from most accounting and ecommerce systems, eliminating manual labor and reducing the risk of error.
Catching Clouds saw the value in an outsourced tax compliance solution that solves one of the most complex headaches for their clients. After all, according to Scott, one of the major keys to their success is standardization of technologies and processes across all clients.
Tax challenges
- Process inefficiency
- Tax complexity
- Compliance risk
Products used
Avalara Managed Returns for Accountants
Give your clients the benefits of a fully managed returns service while you offload the time and manual effort of providing it.
Benefits
- Met an increased demand for returns processing
- Offloaded tedious manual processes that took time away from growth initiatives
- Reduced the risk associated with manually applying rates across more than 13,000 sales and use tax jurisdictions
Industry type
“With Managed Returns for Accountants, we’ve eliminated these time-wasting processes, and reduced risk, and now can better use the time we saved on strategic business advisory and management services.”
—Scott Scharf
CTO and Ecommerce Practice Lead
“With Managed Returns for Accountants, we’ve eliminated these time-wasting processes, and reduced risk, and now can better use the time we saved on strategic business advisory and management services.”
—Scott Scharf
Founder
Results
Once Catching Clouds has their clients set up with Managed Returns for Accountants, Avalara handles virtually all of the sales tax reporting processes. Avalara determines when thresholds are met in any jurisdiction and automatically prepares, files, and remits sales taxes where required.
Catching Clouds maintains managerial oversight of the process at each step via a streamlined management dashboard, which shows the status of all returns with drill-down functionality for more specific data.
“We tried several solutions in the past, but none were able to provide the efficiencies we needed,” says Scott. “We were managing clients with hundreds of returns, and it seemed like each had far too many steps to follow. There was so much time spent simply on entering data, forms preparation, and filing, as well as ensuring compliance with the different regulations in each jurisdiction. With Managed Returns for Accountants, we’ve eliminated these time-wasting processes, and reduced risk, and now can better use the time we saved on strategic business advisory and management services.”