Avalara & Nexternal - Integrated, Accurate Commerce Sales Tax
The Nexternal-Avalara connector will pull real time sales tax rates from the Avalara sales tax system into the Nexternal eCommerce Platform with sales tax accuracy down to the street address level. After conversion of the order, the pertaining order information will automatically be imported into Avalara for tax recording purposes. Likewise, appropriate updates, canceled orders and returned orders and line items will be automatically reflected in Avalara, automating your sales tax processing!
Interested in the Nexternal/Avalara Integration?
Enabling Avalara in Your Nexternal OMS
The first step in setting up the integration is to enable Avalara. For this you will need the Account Number and License Key given to you by Avalara. After you have those available, login to the Nexternal Order Management System and follow the instructions below:
Navigate to Settings / Compatible Software (edit) / Avalara. Enter your Avalara Account Number and License Key in the appropriate fields. If you are using Avalara with other connectors or have multiple online stores, enter a short Company Code to distinguish transactions within Avalara. Leave the Web Service URL set to "Use Default" unless otherwise instructed. Click "Test Connection" to validate your connection. When all information has been entered correctly, click Finish.
Setting Avalara as the Sales Tax Provider
After enabling the Nexternal-Avalara connector, proceed to Settings / Sales Tax (edit) and scroll to the bottom of the screen where the "Third Party Sales Tax Provider" drop down list is displayed and select Avalara. If Avalara is not listed as an option or you do not see the "Third Party Sales Tax Provider" drop down list, follow the instructions listed in the Enabling Avalara section above.
If you have already defined which states you would like to receive rates from Avalara (described in the next section), click Finish. Otherwise stay on this screen and follow the instructions in the next section.
Enabling States to use Avalara
If you are not already there, navigate to Settings / Sales Tax (edit). In Nexternal you can define sales tax for each state as Third Party, State Average, Own Rate, or Undisclosed, denoted as T, A, O and U, respectively, in the drop down list next to each state. Selecting "T" will pull sales tax rates from Avalara for the given state providing you have selected Avalara as the Third Party Sales Tax Provider. If you are not sure which option to select for each state, consult the help text (the question mark icon at the top of the screen) for more information or contact your Account Executive.
When are finished, click Finish to save your work or stay on this screen to set up your tax on shipping configuration (described below).
Tax on Shipping
If you are not already there, navigate to Settings / Sales Tax (edit). You'll notice a "TS" checkbox next to each state. If this checkbox is unchecked, Nexternal will not tax shipping. If it is checked, Nexternal will apply whatever tax rate is provided to us by Avalara (assuming the given state uses the Third Party Sales Tax Provider, as described above).
To defer the configuration for shipping tax to Avalara, check the "TS" checkbox. If your sales tax tables are setup correctly in Avalara, Avalara will pass the 0% as the sales tax rate if shipping should not be taxed and the appropriate tax rate if shipping should be taxed.
When are finished, click Finish to save your work or stay on this screen to set up your shipping tax codes (described below).
Shipping Tax Codes
Tax codes are used in Avalara when setting up your tax tables. When sales tax is being pulled from Avalara, the tax code will accompany each line item to help locate it's appropriate sales tax rate from your tax tables in Avalara.
If you are not already there, navigate to Settings / Sales Tax (edit). By default, each shipment line item will be imported into Avalara with the tax code "FR" if the TS checkbox is checked, and "NT" if it is not. This tells Avalara to apply the sales tax rate for freight when the TS checkbox is checked, and not to tax the shipment if TS is left unchecked.
You may optionally provide a custom tax code to accompany the shipment when it is imported into Avalara. Avalara will then use the custom tax code when determining the sales tax for that shipment.
Click Finish when you are done entering any custom tax codes for shipping.
Product Tax Codes
Similar to shipping tax codes, product tax codes can be used to help identify the correct sales tax rate for a given product in the Avalara sales tax table. To set the tax code for a given product, navigate to Products / Edit Product / Tax Code and enter the desired tax code in the field provided. Click Finish to save changes.
Customer Usage Type
Customer usage types help distinguish tax situations for different customer types. You can specify a particular customer usage type by navigating to Customers / Types / Next / Avalara Customer Usage Type. Click Finish to save changes.
Avalara recommends distributing discounts proportionally among line items. To do this, navigate to Settings / Sales Tax if you are not there already. Locate the Discount Distribution drop down box at the bottom of the screen and select "Proportional-Product". To read more about this option, as well as the other options available, click on the question mark button next to the field.
If at any point you need to temporarily disable the Nexternal-Avalara connector, simply set the Third Party Sales Tax Provider to "Use Default". When you need to enable Avalara again, simply set this field back to Avalara. Click Finish to save changes.
Editing an Order
When editing an order, changes to the order will automatically update the corresponding transaction in Avalara. To edit an order, navigate to Orders / Edit Order. Automatic order updates will only happen when the Nexternal-Avalara connector is enabled. If the connector is disabled (see above) orders will not automatically update Avalara until the connector is enabled again.
Order updates might have a slight delay. If you do not see the update immediately after updating an order, please allow 60 seconds for the transaction to update.
Returning an Order
Returning an order occurs when you change the order-level status of an order to Return-Customer or Return-Ship Agent. This will automatically be imported into Avalara as a separate transaction from the original sales order. To return an order, navigate to the Orders list, and change the order status to Return-Customer or Return-Ship Agent. This can also be done by clicking on the order number to view the order and making the same change to the Order Status.
Just as with editing an order, if you do not see the transaction appear right away in Avalara, please allow 60 seconds for the operation to finish sending the transaction.
Returning a Line Item
Returning a line item works similar to returning an entire order, except the transaction in Avalara will have a slightly different Doc Code. For example, if the order number 142785, the Doc Code for the first line item return will be 142785-1. This allows for individual line item returns to occur independently of each other. This can be valuable when line item returns occur within two different quarters.
If an entire order is returned at the order-level after several line items from that order have already been returned, the remaining unreturned line items will be returned with a new Doc Code.
To return a line item navigate to the order in question from the Orders list and click on the order number to view the order. Scroll down toward the bottom of the screen and change the status on the line item in question to Return-Customer or Return-Ship Agent.
Just as with all other operations, if you do not see the transaction in Avalara right away, please allow 60 seconds to allow the operation to complete.
Canceling an Order
Similar to returns, orders can be canceled at the order-level. To do so, navigate to the order in question and change the Order Status to Canceled. This operation will void all transactions associated with the order in Avalara. This includes line item returns, order updates and full returns.
Canceling a Line Item
Just as with returns, cancels can be done at the line item level as well. However, since individual line items do not have an individual Doc Code associated with them, line item cancels are treated the same as editing an order. The transaction associated with the order will be updated to reflect the absence of the canceled line item.
To perform a line item cancel, navigate to the order in question in the Orders list and click on the order number to view the order. Scroll down to the bottom of the screen and change the status of the line item to Canceled.
Uncommon Status Changes
In Nexternal it is possible, yet uncommon, to change a status from Return-Customer to a status that would logically occur before the item was returned. For example, if you change the status from Unshipped to Return-Customer, then you could conceivably change the status back to Unshipped. In this case, and those similar, the return transaction has already been sent to Avalara and cannot be undone. If the return transaction needs to be deleted in Avalara this needs to be done manually by logging into your Avalara web console and making the appropriate changes. This is the case with Cancels as well.
As mentioned above, users choose on a state-by-state basis, whether to pull sales tax rates from a third party, define their own rate, use the state average or leave it as undisclosed. As such, when an order is imported into Avalara, if the sales tax rate is overridden it is most likely due to the fact that sales tax for that state was determined in a way other than using a third party (Avalara).
Please note that sales tax rates can also be overridden for certain specific zip codes. To verify if a zip code override is in place, navigate to Settings / Sales Tax and confirm that "Zip Range Overrides" is set to a number greater than 0. If so, click Next to the Zip Code Override screen and edit the zip code ranges accordingly.