Avalara is a cloud-based software platform that helps businesses automate tax compliance processes, primarily sales tax, value-added tax (VAT), and other transactional taxes.
It is widely used by companies operating in the U.S. and internationally to handle the complex, ever-changing rules and rates associated with tax obligations.
Key Features of Avalara:
- Sales Tax Calculation:
- Automatically calculates accurate sales tax rates based on location, product type, and other factors.
- Integrates with ERP, eCommerce, accounting, and billing systems.
- Tax Compliance Automation:
- Files sales tax returns with the appropriate jurisdictions.
- Handles tax remittance and recordkeeping.
- Taxability Rules:
- Applies correct tax rates based on product or service type.
- Keeps up with jurisdictional tax law changes (city, state, federal, international).
- Certificate Management:
- Stores and manages tax exemption certificates.
- Ensures businesses stay audit-ready.
- Global Tax Capabilities:
- Supports VAT, GST, and other international taxes.
- Helps with cross-border compliance for eCommerce businesses.
- Audit Support:
- Provides audit-ready documentation.
- Reduces the risk of fines and penalties due to non-compliance.
Common Integrations:
- ERP systems like Microsoft Dynamics 365, SAP, NetSuite.
- eCommerce platforms like Shopify, Magento, BigCommerce.
- Accounting software like QuickBooks, Xero.
Who Uses Avalara?
Businesses of all sizes, especially those that:
- Sell in multiple states or countries.
- Have complex product/service taxability.
- Want to reduce manual compliance efforts and audit risks
How does Avalara integrate with Microsoft Dynamics 365 Business Central?
Avalara integrates seamlessly with Microsoft Dynamics 365 Business Central through its AvaTax solution, enabling businesses to automate and manage tax compliance directly within their ERP system.
Here’s an overview of how this integration works:
Integration Overview
Avalara’s AvaTax extension for Dynamics 365 Business Central offers real-time tax calculation and compliance management.
Key features include:
- Automated Tax Calculations: Calculates accurate sales and use taxes based on transaction details and jurisdictional rules.
- Address Validation: Ensures precise tax rates by validating shipping and billing addresses with rooftop-level accuracy across over 13,000 U.S. tax jurisdictions.
- Exemption Certificate Management: Stores and manages tax exemption certificates, linking them to customer profiles and providing alerts for expirations or invalidations.
- Returns Filing: Automates the preparation, filing, and remittance of tax returns across multiple jurisdictions.
- Global Tax Compliance: Supports VAT, GST, customs duties, and other international tax requirements, aiding businesses operating in over 190 countries.
This integration helps centralize tax management, reduce manual errors, and ensure compliance with evolving tax laws.
Setup Process
To integrate Avalara AvaTax with Microsoft Dynamics 365 Business Central:
- Install the Avalara AvaTax Extension: Available on Microsoft AppSource, compatible with both Essential and Premium editions of Business Central.
- Configure Connection Settings: Enter your Avalara account credentials, including Client ID and Client Secret, within the Avalara Connection Setup page in Business Central.
- Select Company and Mandate: Choose the appropriate Avalara company and mandate settings to align with your business’s tax requirements.
- Map Tax Area Codes: Align your general ledger accounts with Avalara’s tax area codes to ensure accurate tax postings.
- Test the Integration: Verify the setup by processing test transactions to ensure accurate tax calculations and proper system communication.