Simplifying CA Sales Tax: How Kintsugi Scales Small Businesses
Barkin Doganay · October 11, 2024 · 7 min read
Who is Capay Valley Lavender
Founded in 2017, Capay Valley Lavender has grown a ton in the past year by producing high-quality, organic lavender-based products. With over 10,000 lavender plants being cultivated on their farm, they offer everything from essential oils to culinary and body care items. As their ecommerce business started to sell more throughout California, they faced a growing challenge: handling the demands of sales tax compliance across the state’s varying tax jurisdictions.
In their search for a solution, Capay Valley Lavender found Kintsugi, a tax automation platform designed to simplify reporting and ensure compliance. By integrating Kintsugi into their Shopify store, they eliminated the need for manually registering and tracking sales in California’s many different tax regions. This newfound efficiency allowed Capay Valley Lavender to redirect their focus from administrative tasks to tending to their farm and handcrafting products.
The Challenges of CA Sales Tax Compliance
As Capay Valley Lavender’s taxable sales grew within California, managing sales tax compliance became overwhelming for Sherry, the owner of Capay Valley Lavender. The manual processes for calculating taxes and dealing with California’s differing sales tax rates were incredibly time-consuming, often taking up half of her day. Filing sales tax returns while staying compliant with the state's multiple tax obligations became a significant burden, especially for a small business with limited resources.
“Understanding transaction rules for retailers in California, where both state and special district taxes apply, was overwhelming,” Sherry explained.
For small businesses like Capay Valley Lavender, managing sales tax involves more than just knowing the sales tax rate—it requires staying updated on the constantly evolving local regulations (kintsugi). This increased the risk of non-compliance and potential audits, adding to her already heavy workload. Before finding Kintsugi Sherry had to divert a lot of time away from her farm and handcrafting products, which highlighted her need for a more streamlined, automated tax solution.
Kintsugi's Software Services Save Time and Money
Sherry needed an automated solution for managing her tax compliance that could also integrate seamlessly with Shopify, her e-commerce platform. Kintsugi stood out because it offered this integration, simplifying the entire process of managing sales tax permits, remittances, and filing requirements. Additionally, Kintsugi’s automation features, such as sales tax calculations and compliance monitoring, eliminated the need for time-intensive manual efforts, making it both practical and cost-effective for her growing business.
“Adopting Kintsugi to do our sales tax was absolutely wonderful... My bookkeeper charged a whole lot more than I was willing to pay when I found this software,” Sherry shared.
Another key factor in Sherry’s decision was Kintsugi’s affordability compared to other solutions. As a small business owner managing multiple responsibilities, cost was a crucial consideration. Kintsugi’s pricing structure fit within her budget while offering comprehensive features. The combination of seamless integration and cost-effectiveness made it the ideal choice for Capay Valley Lavender.
Kintsugi Streamlines Efficiency with California's Complex Sales Tax
After Capay Valley Lavender started using Kintsugi’s tax automation software, Sherry saw it significantly reduced the time and money spent on managing sales tax compliance. What previously used to take hours now took just 30 minutes. “I did it on a Sunday afternoon, needed some help, and someone at Kintsugi was there. Thirty minutes later, I was filed,” she explained. By automating sales tax calculations and filings, she not only saved time but also avoided the costly risks associated with non-compliance, improving her overall operational efficiency.
Since California sales tax is based on gross sales rather than profits, manual tax management was costing the farm valuable time and resources. The complexity of local tax laws and the risk of costly audits further increased the financial burden. By automating Capay Valley Lavender’s tax compliance, Kintsugi reduced these hidden costs, allowing the farm to focus on growth while minimizing the financial impact of taxation on their small business (Kintsugi).
How Kintsugi Impacted Capay Valley Lavender
Seamless Integration with Shopify: Kintsugi’s Shopify integration enabled Capay Valley Lavender to fully automate tax calculations and filings directly through their existing platform. This eliminated the need for manual tax management, ensuring that their sales tax was calculated accurately at checkout and compliance filings were handled automatically. For Sherry, this meant she could spend less time on administrative work and more time focusing on her farm.
Cost-Effectiveness: Kintsugi’s automation replaced the need for costly bookkeeping services. The platform’s affordability, compared to outsourcing her sales tax management, resulted in significant savings. By choosing Kintsugi, Sherry reduced the financial strain of complying with California’s complex tax regulations while maintaining accurate records.
“What made the difference with Kintsugi is the support. I wear so many hats, and I don’t have an accounting department, so I really appreciated the level of support,” Sherry explained.
Ease of Use: Kintsugi’s intuitive platform made implementation easy for Capay Valley Lavender. Sherry, who handles many of the business operations herself, found the software easy to use, simplifying a previously overwhelming process. The platform provided immediate relief from the burdens of CA sales tax management, giving Sherry more time to focus on growing and cultivating her lavender.
What's in Store for the Future
As Capay Valley Lavender plans for the future, they see Kintsugi as an essential tool in expanding their e-commerce operations. With Kintsugi managing California’s intricate tax regulations, Sherry can focus on scaling her business by developing new products and increasing online sales without the stress of manually doing her tax calculations and filings. The efficiency gained from automation will enable the farm to reach new markets while staying compliant with the local tax laws.
By automating tax processes, Sherry envisions Kintsugi playing a key role in helping Capay Valley Lavender grow sustainably. As the business adds new products and seasonal offerings, Kintsugi’s user-friendly platform will make it easy to manage their sales tax obligations and ensure compliance. With more time devoted to farming and crafting her products, Sherry is confident that Kintsugi will support the long-term goals and success of her company.
About Kintsugi
Based in San Francisco and founded in 2022, Kintsugi is dedicated to taking the stress out of sales tax compliance. Our platform automates the entire process, delivering high performance, reliability, and flexibility as your business scales.
Kintsugi is secure, encrypted, GDPR-compliant, and SOC 2 Type II certified, adhering to the highest standards for security, availability, processing integrity, confidentiality, and privacy.
Learn more about Kintsugi’s platform and integrations here.
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