Integrations: Avalara (AvaTax)

Integrations: Avalara (AvaTax)

Overview

The Avalara (AvaTax) integration in CustomBooks™ enables automated sales tax calculation within our accounting system.

AvaTax is a cloud-based tax compliance solution that calculates real-time sales tax rates based on location, tax rules, and product taxability. When integrated with CustomBooks™, it helps ensure accurate tax calculations on transactions such as invoices, sales orders, and credit memos.

Read more about Avalara’s AvaTax.

Benefits of AvaTax Integration

  1. Real-Time Tax Calculation – Automatically calculates sales tax based on customer location and applicable tax rules.
  2. Improved Accuracy – Reduces manual tax errors and miscalculations.
  3. Automated Compliance – Applies up-to-date tax rates and jurisdiction rules.
  4. Time Savings – Eliminates the need to manually maintain tax tables.
  5. Audit Trail – Stores tax calculation details within each transaction.

How It Works

Once connected:
  1. CustomBooks™ sends transaction details (customer address, item information, amounts) to AvaTax.
  2. AvaTax calculates the correct sales tax in real time.
  3. The calculated tax amount is returned and applied automatically to the transaction.
  4. The tax details are recorded within the document for reporting and compliance purposes.

Supported Transactions

AvaTax can calculate tax for:
  1. Sales Invoices
  2. Sales Orders
  3. Credit Memos
  4. Other taxable sales transactions within CustomBooks™

Setup Requirements

Before enabling the integration, you will need:
  1. An active Avalara AvaTax account
  2. Account credentials (Account Number, License Key, and Company Code)
  3. Proper tax configuration within your AvaTax account
It is recommended to coordinate with your CPA or tax advisor before activating the integration to ensure proper tax settings and compliance. We also highly suggest enrolling in Avalara University and completing the Avatax Learning Path, which will walk you through setting everything up in Avalara before you integrate your account in CustomBooks™.

Setting Up AvaTax

Before connecting AvaTax to CustomBooks™, ensure the following information is properly configured in your Avalara account:

1. Company Setup
  1. Confirm your Company Code is created in AvaTax.
  2. Verify business details, such as company address and filing information, are accurate.
2. Nexus Configuration
  1. Set up nexus jurisdictions (states or regions where you are required to collect sales tax).
  2. Ensure nexus settings match your business operations.
3. Tax Codes
  1. Assign appropriate tax codes to products or services within AvaTax.
  2. Verify taxability rules for each product category.
4. Customer Exemptions (If Applicable)
  1. Configure exemption certificates for tax-exempt customers.
  2. Ensure exemption documentation is properly stored and validated in AvaTax.
Proper setup in AvaTax ensures smooth integration and accurate tax calculation within CustomBooks™.

Connecting AvaTax to CustomBooks™

  1. Navigate to Admin Panel → Integrations.
  2.  Click the gear Setting icon  on Avalara AvaTax.
  3. Click "Connect to AvaTax" button.
  4. Enter your AvaTax credentials.
    • Avalara account number
    • License Key
    • Company Code
  5. Then connect.

     6. After connecting, you can then configure general options and set default tax codes. (optional)


Once successfully connected, tax calculations will be automated on eligible transactions.

Important Notes

  1. Tax rates are maintained within AvaTax, not CustomBooks™.
  2. Any tax rule adjustments must be configured directly in your Avalara account.
  3. Ensure customer addresses are complete and accurate to avoid calculation errors.

Troubleshooting

Tax Not Calculating:
  1. Make sure AvaTax is connected in CustomBooks™.
  2. Verify AvaTax credentials are correct.
  3. Confirm customer address information is complete.
  4. Ensure the transaction is marked as taxable.
Incorrect Tax Amount:
  1. Review tax rules, tax codes, and nexus settings within Avalara.
  2. Confirm product taxability configuration is correct.

For technical concerns, contact CustomBooks™ Support or Avalara Support for further assistance.