Avalara
Automated software for sales tax compliance.
About Avalara
We’ve been disrupting the status quo in the scintillating world of sales tax management since 2004, and we’re not about to stop. In fact, we are picking up speed every day, setting new milestones of growth and service and blazing new roads in a very old industry. From the beginning, our dedicated team of revolutionaries has worked day and night to deliver on one simple promise: to provide the fastest, easiest, most accurate, reliable and affordable way to manage transactional taxes.
This promise is our mantra and we are driven to deliver it.
INTRODUCTION
The Drupal Commerce Connector for AvaTax is a Drupal compliant module that integrates the Drupal Commerce check-out process with AvaTax from Avalara, Inc. and is used for sales tax calculations and sales tax compliance.
AvaTax reduces the audit risk to a company with a cloud-based sales tax services that makes it simple to do rate calculation while managing exemption certificates, filing forms and remitting payments.
The module supports three modes - Trial - Basic - Pro - which correspond to the levels of service available for AvaTax.
The Trial configuration provide on-line registration for calculating the sales tax amount in any state. The trial account provides no access to an AvaTax account or user dashboard. Details of the sales tax transactions are recorded in the Drupal logs.
Access to a development account can be requested by contacting Avalara, Inc.
The AvaTax Basic service offers limited use of the AvaTax sales tax codes, in particular P0000000 for Personal Taxable goods, Shipping tax codes and NT for Not Taxable goods.
The AvaTax Pro service offers full use of the AvaTax sales tax codes. The Pro service is required for states like New York were sales tax rates can be based on the type of product, the delivery address, and the time of year.
Sales Tax is calculated based on the delivery address, the sales tax codes assigned to line item in the order, and the sales tax rules applicable to the states in which Nexus has been set up.
Version 4.0 of the module is compatible with Drupal 7.x and has been tested with Drupal Commerce 1.x
REQUIREMENTS
a) The service uses the AvaTax REST api for processing transactions.
b) The server PHP configuration must support cURL
c) Please note the 20 transaction limit on the Trial account.
NEW INSTALLATION
Installing the module is done as for any custom Drupal Commerce module
a) Unzip & copy the folder "commerce_avatax" to the location shown below, or in accordance with your Drupal Commerce configuration.
yoursite/sites/all/modules/commerce_avatax
b) Enable the two modules (AvaTax Calc & AvaTax UI) in the usual Drupal way.
c) Do NOT enable the companion module - AvaTax Exemptions - unless you sell goods to sales tax exempt organizations, and wish to allow new buyers to purchase goods without being charged sales tax prior to registering their sales tax exemption certificate.
User instructions for AvaTax Exemptions can be found at bottom of this README
CONFIGURATION
a) Select Store -> Configuration -> AvaTax settings
b) Complete the information requested after reading the following notes.
c) Save the form - AvaTax settings - on completion.
General settings
a) AvaTax Version
- Trial - Enter your name and email address. Fetch Trial credentials.
- Basic or Pro - Only if you have an AvaTax account and have set up a company.
b) Company Code
- Enter the AvaTax company code for the company you have configured (in case of development was configured for you) in your AvaTax account. Please make sure that you have configured Nexus for the company correctly.
c) Sales tax description
- Enter the Sales tax description to be used on the order review page
Shipping settings
a) The module allows limiting sales tax calculations using the AvaTax service to explicitly selected states. The default option is for this selection to be left blank. All orders will be sent to the AvaTax service on checkout. It is important that you consult with an accountant or sales tax advisor on your legal obligations to collect Sales Tax. Select "--" to use module for address validation only.
b) Shipping Tax Code: FR020100 is the AvaTax sales tax code for shipping by public carrier (USPS, Fedex, etc)- without any change to the rate charged. Please refer to Avalara for the correct shipping sales tax code if you have a different shipping method or billing model. Only one shipping sales tax code is supported.
c) Select destination Address to use for Sales Tax: Select Shipping unless your site ONLY sells digital goods. Sales Tax regulations state that the delivery address of digital goods is the customers billing address. If your site sells both digital and physical goods, please select Shipping. If the site allows a combination of physical and digital goods on one order please contact adTumbler to discuss how to extend the module.
d) Primary Address: NB - Sales tax law requires that a sales tax transaction record the place from which good are shipped. This version of the module does not support Drop Shipments. However, sales tax will be correctly calculated so long as a valid primary office address is entered.
Address Validation
Configure as required - only available if Shipping Selected
Credentials
Configure as required - only available if Basic - Pro - selected
a) Select Development or Production. Only select production if you have a production account with AvaTax
b) Enter the Production or Development Account number
c) Enter the Production or Development License key
d) Use Validate credentials to test connectivity to AvaTax for the account # and license key entered
Sales Order Processing
Configure as required - only available if Basic - Pro - selected
We strongly suggest that this option is only selected after the module is installed and working. There are significant sales tax compliance requirements to automating the sales tax order processing and completion process.
This option is implemented by enabling 3 rules - these can be customized according to the business requirements.
AvaTax Exemption Settings
If selected, the module will create a "sales_tax_exemption" field on the user entity when the administration form is saved.
This field is created with a default value of " " - which means sales tax is to be calculated for this account.
To add an exemption type to a user: Select the menu option - admin/people - edit user - select the sales tax exemption code applicable - save the user entity
The exemption value will be passed to AvaTax with any transaction made by this user when logged in to their user account. AvaTax will use this value to override any regular sales tax for transaction, according to the sales tax rules applicable to the state and address used for tax ability.
Note: A company is required to keep a valid copy of the sales tax exemption certificate - for any user for whom sales tax is not charged!
Configure AvaTax Pro
Configure as required - only available if - Pro - selected
Enabling the Pro version of the module will:
i) Create a sales tax vocabulary to manage the AvaTax Pro sales tax codes to be assigned to each products.
ii) Create a sales tax code field for selected Product Types
The AvaTax Go Live team will work with you to determine what AvaTax sales tax codes should be assigned to each product.
Add the required sales tax codes to your sales tax vocabulary.
Add the correct sales tax code to each product in your catalog. If no sales tax code is assigned to a product, the module will default to tax code P0000000
OPERATION OF MODULE
a) There is no test connectivity button provided. To test connectivity to AvaTax, process an order with a delivery address in a state where Nexus has been configured. Visually inspect the cart for inclusion of a sales tax amount on the review order form. An AvaTax error will (caused by an incorrectly configured account/license key) display an error clearly on the check out form.
b) The sales tax transaction is created in the AvaTax cloud service at the same time Drupal Commerce allocates an order number to the order object. This is done in order to synchronize the Drupal Commerce order number with the AvaTax transaction.
c) A separate line item is added to the Drupal Commerce Order for the sales tax amount.
d) If creating orders using order administration, you are required to add the product lines, the shipping lines, enter a valid address and then save the order to allocate an order number. One this has been done, you can add a sales tax line item to the order.
e) If anything is updated on an order that can affect sales tax (address, quantity or price) we suggest that you make the changes and delete the AvaTax line item. Save the order to reflect the updates. Then add a new sales tax line item to the order. AvaTax will recalculate the sales tax and write the new values into the original transaction. This assumes that the AvaTax entry has not been committed (refer sales order processing).
MATCHING LINE ITEMS TO SALES TAX CODES - BASIC SERVICE
The computation of Sales Tax Rates and the Sales Tax Amount is determined by the configuration of the AvaTax account, in particular Nexus configuration.
All Product line items default to
?- P0000000 - Personal Taxable Goods.
The Discount coupon line item in the order defaults to the sales tax code
- OD010000 - discount on Personal Taxable Goods.
The Shipping product line item is defined by the sales tax administrator
- default - FR020100 - Public Carrier at prices quoted.
The AvaTax cloud service allows the creation of custom Tax Codes, Tax rules and the assignment (Items) of Drupal Commerce product codes to a sales tax code.
Please refer to a sales tax advisor for sales tax compliance.
If you supply Taxable Products that are NOT Tangible Personal Property, you are required to set up your own Tax Codes and Tax Rules for these products.
(See Pro service for use of AvaTax Tax Codes and Tax Rules)
The Item function in the dashboard is used to map each taxable Product Code established in the Drupal Commerce catalogue (that is NOT Tangible personal Property) to the Tax Code supporting it's tax rules and rates
If you supply Products that are EXEMPT of sales tax in SOME states you are required to set up your own Tax Codes and Tax Rules for these products.
(See Pro service for use of AvaTax Tax Codes and Tax Rules)
The Item function in the dashboard is used to map each EXEMPT Product Code established in the Drupal Commerce catalogue to the Tax Code supporting it's tax rules and rates.
NB: If you supply Products that are EXEMPT of sales tax in all states where you have Nexus (collect sales tax) you may use the Item function in the dashboard to map each EXEMPT Product Code established in the Drupal Commerce catalogue to the AvaTax Tax Code - NT - Non Taxable Goods
MATCHING LINE ITEMS TO SALES TAX CODES - PRO SERVICE
Please contact Avalara, Inc for details on assigning sales tax codes to product items
PRODUCTION ACCOUNT - GO LIVE PROCESS
The production account number and license key will be supplied to the sales tax administrator after they have completed the Go Live training call with Avalara.
Replace the Development Company Code provided with the development account, with the company code created for the production company
Select Production - enter the new account information.
Save the form.
NB: Do check with the sales tax administrator that any custom tax codes, and Nexus configurations, created in the development account have been configured for the company created in the production account.
It is suggested that customers set up two companies in their production AvaTax account - a test company for test transactions - and a production company for normal operations.
UPGRADE FROM EARLIER VERSIONS
There is no upgrade path provided for version 1 or 2 or three to this version of the module - using the new REST api from Avalara.
The AvaTax module stores data in the table called "variable"
V1 was implemented using a hook from the Sales Tax module. It did not create a sales tax line item. Sales tax data was saved as data elements in the product line item. Once the V1 module is removed sales tax amounts may not be correctly displayed on old orders.
V2 implemented a custom sales tax line item based on the shipping module, and added a checkout page. The requirement for a sales tax check-out page has been removed in V3 at the request of the community.
DO NOT attempt to install this module with an earlier version.
We apologize for the major architectural changes between versions and suggest that Drupal databases are backed up prior to an earlier version being removed.
Open Issues
1) Refer Operation of Module - for correct way to manually create or update an order.
2) When using the Checkout Progress module. If a user reviews an order, the selects the shipping page link to go back (as opposed to selecting go back from the bottom of the check out page) there is a status bug in checkout Shipping, that prevents the sales tax line from being recalculated if the shipping amount is changed.
AvaTax Exemptions
Enable the modules AvaTax Exemptions in the usual Drupal way.
a) Select Store -> Configuration -> Checkout settings
b) Select Sales tax -> configure - in the Checkout pane of the form
c) Select the states for which the sales tax exemption pane can be displayed. This is usually the states that the company has Nexus
d) Select the user roles for which the sales tax exemption pane will be displayed. This is usually for "anonymous user" only. Registered users will have their sales tax exemption added to AvaTax - keyed on the Drupal account
e) Enter the message that will be shown to the user in this pane. The message should explain that only a buyer who has a valid exemption certificate may elect to not be charged sales tax, that wrongful use of this option is an offence, and what the policy is for obtaining a copy of the exemption certificate is prior to goods being shipped.
Sales tax is complex and confusing, a moving target with ever-changing rates and rules. It’s not only a pain, it’s a drain on valuable resources that should otherwise be adding value to the bottom line. Did you know that orange juice is taxed 300 different ways in the United States, or that if you sell a pair of pants on the first Friday in August during the Back to School Sales Tax Holiday in Missouri, that they’re likely not taxable? You probably didn’t; but if you use an automated sales tax management approach, you won’t have to!
Avalara offers the only fully automated, complete end-to-end sales tax compliance solution that
- Accurately calculates sales and use taxes down to the rooftop level using geospatial latitude/longitude technology (think GPS for sales tax), far more accurately than zip codes or any other available technology,
- Requests, creates, validates, stores, and manages sales tax exemption and reseller certificates and makes them available for easy retrieval, substantially reducing risk during an audit, and ensuring that every non-taxable transaction is tracked.
- Applies your transaction tax data and prepares all forms and remits payments to each taxing authority.
Avalara works with Drupal Commerce, or whatever other financial, billing, ecommerce, or point of sale system you might want to use, to automate sales and use tax and compliance. Once configured, you never again worry about ever-changing, hard to keep track of and understand, rates, rules, boundaries, exemptions, tax holidays, reporting requirements, filing deadlines, etc. etc. etc. Avalara combines industry-leading technology with the best available statutory content to deliver unsurpassed and fully automated sales tax compliance solutions. We do more than 2 billion sales and use tax calculations every year (that’s over 5.5 million every single day!), and file hundreds of thousands of tax returns for our customers annually.
Simply put: we make sales tax less taxing. And we have a lot of fun in the process!
“We went through three or four different options, but none of them were as robust as Avalara, because we knew we wanted to grow, and in growth, we wanted something we knew we could grow into… and not have to re-evaluate every three to five years… It was the best thing we did…we’re in probably thirty-eight states and five provinces in Canada right now, all through Avalara.”
-- Al Vasile Assistant Treasurer, FleetMatics USA
Our customers love us and our excellence is recognized frequently. Avalara is the industry leader in cloud-based sales tax and compliance automation services, recognized as one of America’s fastest growing technology companies by Deloitte (Deloitte’s 2013 Technology Fast 500™) and Winner of the 2013 Red Herring Top 100 North America Award. From industrial durable goods to home furnishings, from apparel to health services, for some of the smallest merchants on the web to some of the world’s largest brands, Avalara serves tens of thousands of businesses globally, in more than 105 countries worldwide.
How Avalara Handles Sales Tax Compliance for You
Avalara’s sales tax automation solution lives in the cloud. That means it’s highly scalable, so we’ll always be able to handle all the transactions you can throw at us.
Avalara AvaTax is an SSAE 16 attested solution. That means that you know that your data is secure, and that it is being managed to the highest standards published by the world’s largest member association representing the accounting profession (AICPA).
And Avalara AvaTax is the only sales tax automation solution that has been awarded a 5-star rating by CPA Practice Advisor (2012).
Avalara aggregates more than 100,000 sales tax rules, 10,000 US tax jurisdictions, 150 million addresses and countless other sales tax regulations around the world. That means that you know that for every single transaction with your customers, tax is being calculated accurately and remitted properly, to each and every relevant taxing jurisdiction! And that enables you to keep your people focused on the stuff that adds to your bottom line.
Our service validates your customer’s address down to their rooftop so that you collect all the applicable sales taxes. It knows the thousands of variations in product and service taxability rules, so you are always collecting the correct tax. It can keep track of your customers’ exemption certificates, and automatically manage expirations and renewals, so you don’t need to spend valuable time searching through file cabinets. With Avalara, it’s all there in the box, including sales tax reporting, and we can even do the filing for you!
About Avalara
We’ve been disrupting the status quo in the scintillating world of sales tax management since 2004, and we’re not about to stop. In fact, we are picking up speed every day, setting new milestones of growth and service and blazing new roads in a very old industry. From the beginning, our dedicated team of revolutionaries has worked day and night to deliver on one simple promise: to provide the fastest, easiest, most accurate, reliable and affordable way to manage transactional taxes.
This promise is our mantra and we are driven to deliver it.