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Software for US Corporation

Recommendations for software for new USA subsidiary

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Hi folks,

We are looking into opening a US subsidiary (C-Corp) of our £5m turnover UK Ltd company, but as far as I understand it, we can't use our current Sage 50 software for the bookkeeping side of things as it is UK specific. Does anyone have any recommendations for software that I will be able to use for the US side of things?

Cheers!

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By nrw
15th May 2019 12:21

Xero

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By johnt27
15th May 2019 12:29

Xero or QBO

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15th May 2019 12:43

Book-keeping doesn't fundamentally differ between the US and UK. The differences come down to what you need to do for tax compliance.

For example, there is no VAT in the US and if you are B2B, you're unlikely to have to account for sales tax - but you will still need to ensure that you obtain exemption certificates from your customers.

US corporate taxes are levelled at federal (national), state, and in some cases county/city. You need to think carefully about where your entity is established and where you are holding inventory.

and so on

Lots of questions to understand. *Then* you can think about what you actually need and whether or not Sage 50 can satisfy those requirements.

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to paul.benny
15th May 2019 12:55

Much appreciated, aware of these points already. The other aspect that we have is that we will be receiving orders for the US through some specific electronic order delivery system which needs to be compatible- much fun!

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By johnt27
to eclipse15000
15th May 2019 13:27

If the order delivery system is US specific you may well be better to go down the QBO route - it's an American product and much more integrated with US systems than Xero.

Having said that I prefer Xero and most of the businesses I deal with that have international operations seem to do so as well, particularly as integrated reporting using 3rd party apps are better developed in the Xero ecosystem.

If you're selling certain online services in the US they have just started to roll out state by state taxes similar to VAT MOSS in the UK.

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By nrw
to paul.benny
16th May 2019 08:47

paul.benny wrote:

if you are B2B, you're unlikely to have to account for sales tax

Unlikely may well be the case, but bear in mind that there are many cases where sales tax does fall due on B2B sales - and this is growing with rapidly evolving US legislation (including some very recent changes).

We have been advised by US accountants that sales tax does fall due for a B2B SaaS business - there are (relatively) low sales thresholds which have to be assessed on a state-by-state basis and things like 'nexus' need to be ascertained (which doesn't exclude companies without a physical presence in a state). It's an unpleasantly grey and complex area to navigate!

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15th May 2019 12:48

I wonder what your accountant thinks.

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to Red Leader
15th May 2019 12:53

Our accountant said that no one in their practise has any experience dealing with the US. We are now looking for a new one......

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By Matrix
to eclipse15000
15th May 2019 19:26

I assume you have taken US tax/legal advice on the set up of the new entity so ask the advisers to recommend a local accountant since won’t you need to know how much the US compliance will cost, the deadlines etc? US tax is never simple.

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