How Sovos calculates gross amounts
Sovos wants to make sure that the appropriate and most up-to-date tax rate is applied during the tax calculation. That's why Sovos takes your tax amount and works backward from it by applying the tax rate stored in the Sovos 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, Sovos 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 Sovos Global Tax Determination. GTD 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 Sovos’ software couldn't find the transaction eligible for exemption.
Missing transaction data
Not all transactions in your ledger were uploaded to Sovos.
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.