CLIENT
Our client is a large pharmaceutical manufacturer that experienced a large divestiture and subsequent acquisitions in recent years.
CHALLENGE
Following the acquisition and systems transitions, the company faced significant tax overpayments due to incorrect or missing tax mappings in its tax engine. The integration of different ERP systems and transition from one tax solution to another exacerbated the issue. The company’s lean tax team lacked the resources to identify and resolve the problem in a timely manner, leading to excessive use tax payments over multiple years.
SOLUTION
As a sales and use tax compliance consultant for the client, DMA identified anomalies in tax payments early on. Our team continued to monitor the situation and eventually gained approval to conduct a full review. With only a few weeks before a critical statute of limitations deadline, DMA quickly gained access to the company’s transactions, conducted a detailed analysis, and executed a refund claim strategy. The review focused on mapping errors related to software, cloud computing, manufacturing operations, and more.
RESULT
Our teams worked together to achieve the following results:
- Identified and submitted a refund claim for $4.1 million in tax overpayments for one year
- Prevented the loss of significant refunds that would have expired at year-end
- Continued working on another $2 million in recoveries for additional years
- Expanded reviews into other states, where further overpayments are expected
- Enabled the client to improve tax mappings and compliance processes going forward
WHY DMA
DMA’s proactive approach to monitoring compliance filings allowed our team to detect the issue early, demonstrating our commitment to more than just filing tax returns. Our long-standing relationship with the client, deep understanding of tax automation, and ability to work under tight deadlines reinforced our position as a trusted and effective partner. Additionally, DMA’s TransactionTax360™ approach ensured that errors were not only corrected for past transactions but that future processes are optimized to prevent recurring issues.
Recover Overpaid Tax
DMA’s experts can help identify tax engine mapping errors and recover past overpayments.