We have teamed up with Avalara to automate sales tax compliance. Our integration with Avalara AvaTax handles tax calculation for you based on the products and services you sell. The integration will add sales tax to invoices, estimates, and credit notes.
The setup process assumes that you have already established an Avalara account and already configured Avalara for the jurisdictions where your business has nexus.
Once you've connected Avalara successfully there are additional settings that you can change to customize the behavior of the integration in Settings → Integrations → Configure (Avalara).
The Commit Mode setting controls how transactions are sent to Avalara. Here is an explanation of each commit mode:
Once the integration is configured, you can start to benefit from instant, accurate tax calculations. The integration will generate tax in the following scenarios:
Creating an invoice will produce a sales invoice on Avalara. Modifying an invoice will produce the corresponding adjustment on Avalara, but only if you select the "Calculate Taxes" option when editing the invoice. Deleting an invoice will void the transaction on Avalara.
Creating a credit note will produce a return invoice on Avalara. The amounts on the return invoice will be negative to reverse the sales tax that was originally collected on the credited items.
Modifying a credit note will produce the corresponding adjustment on Avalara, but only if you select the "Calculate Taxes" option when editing the credit note. Deleting a credit note will void the transaction on Avalara.
Estimates will create tax as a sales order on Avalara in order to provide you and your customer with an accurate sales tax estimate. However, the sales tax on the estimate will not be filed on a tax return unless that estimate is converted into an invoice.
If you modify an estimate you must select the "Calculate Taxes" option to re-calculate taxes.
Below are limitations and edge cases to be aware of when using the Avalara integration.