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Year-End Sales Tax Review

Learn about how to review and confirm your sales tax amounts in your Year End Hub

Written by Emily Burrows

About

The Year End Hub includes a "Sales Tax" task under Other Items in your checklist.

This task helps you review your sales tax liability balance in Finaloop to ensure everything matches your records and is accurate for your tax return.

This guide will walk you through how your sales tax liability is calculated in Finaloop and how to verify your balance as part of the year-end process.

1. How Finaloop Calculates Sales Tax

Integrated sales channels

Finaloop automatically syncs sales tax data from these platforms:

  • Shopify

  • Amazon

  • TikTok Shop

  • Etsy

  • Walmart

  • eBay

  • PayPal invoices

  • Stripe invoices

Here’s how we calculate and reconcile your Sales Tax Liability on your Balance Sheet for these integrated sales channels:

  1. We sync sales tax collected from your customers through your integrated platforms and add these amounts to your existing Sales Tax Liability balance (if relevant).

  2. We track any sales tax remitted directly to tax authorities by the integrated sales channels (e.g., Amazon, TikTok Shop or other marketplaces). This amount is reduced from your Sales Tax Liability balance. The result is what we refer to as Net Sales Tax Collected.

  3. When you categorize a bank or card transaction as a sales tax payment, the Sales Tax Liability balance decreases, so you can keep track of the amount you still owe.

So to sum it up:

Sales Tax Liability in Finaloop = Opening balance on Jan 1 + Net Sales Tax Collected - sales tax payments from your bank or credit card transactions

Non-integrated sales channels

For sales channels not integrated with Finaloop (e.g., BigCommerce or WooCommerce), the sales tax you owe from these channels won't be automatically included in your Sales tax liability balance in Finaloop. To update this, you’ll need to:

  1. Check the Net Sales Tax Collected in your sales platform reports.

  2. Manually add this amount to Finaloop as part of the year-end process in Finaloop.

2. Verifying Your Year-End Sales Tax Balance

In the Year-End Hub checklist, we'll ask you to review and confirm your sales tax liability at year end.

If the balance we show you looks different than expected, we'll need you to update the number.

Why would the balance be different than expected?

If this happens, don't worry. Data is auto-synced from integrated channels like: Shopify, Amazon, TikTok Shop, Etsy, Walmart, eBay, PayPal Invoices and Stripe Invoices, but other channels may not be included.

Since there are certain channels that may not be automatically synced, it just means we need a quick update from you. You can add the sales tax collected from the non-integrated channels by clicking on Reporting a different balance.

Not sure what the balance should be?

If you have no historical sales tax debt and you remit payments monthlyyou, your liability is typically your January remittance, covering December sales.

To confirm this, you can compare your Finaloop balance to your external sales tax records, such as:

  • Your internal tracking records,

  • Your CPA’s records (if they’re managing your sales tax), or

  • External sales tax filing software (e.g., TaxJar, Zamp, Numeral, Avalara) if you are using one.

If you report a different balance, our accounting team will review your input and make the necessary adjustments. (Please note: updates will not appear immediately in your balance.

Need Help?

If you have any questions or need assistance, reach out to us at [email protected]. We’re here to help make the process as smooth as possible!

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