Managing Taxation with Avalara Connector

If your SHOPLINE store needs to calculate and collect taxes, SHOPLINE offers the Avalara Connector to help merchants manage tax compliance. It integrates with Avalara’s tax calculation and management services. Once connected, Avalara assists with tax calculations and filings, providing real-time, up-to-date tax rates to ensure compliance across different regions.

After subscribing to the SHOPLINE Enterprise plan, you can connect your Avalara account and assign tax codes to your product types. Avalara will automatically retrieve the correct tax rates based on your store's shipping address and customers’ delivery addresses, and calculate taxes accordingly.

Connecting Your Avalara Account to SHOPLINE

Before using the Avalara Connector, register an Avalara account on the official Avalara website. If you already have an account, follow the steps below to generate your license key and complete the connection:

Generating the License Key 

To use Avalara as your taxation service, first generate a license key to connect your account to SHOPLINE. Follow these steps:

1. Log in to your Avalara account.

2. In the Settings section, set up your company information and the regions where you collect tax.

   

3. To generate a license key, go to Settings > License and API keys, then click Generate new key.

   

4. In the pop-up window, confirm by clicking Generate license key.

   

5. Save this key securely. You will need it to complete the integration.

   

Connecting Avalara to SHOPLINE

After obtaining your license key, return to the SHOPLINE admin panel to connect your Avalara account:

1. From the SHOPLINE admin panel, go to Settings > Taxes and fees.In the country/region list, find United States, enable it, and click the pencil icon to enter the settings page.

   

2. In the Current taxation service card, click Change the service, select Avalara from the pop-up, and click Complete.

   

3. Once Avalara is selected, click Connect account.

   

4. In the pop-up window, enter your Account (the email you used to register for Avalara) and License key (obtained from the steps in the previous section), select the Production environment, and click Next.

   

5. Select your Tax calculation company, check Enable tax calculation service, and choose the Action type:  

   

   • Calculation only: Use Avalara to calculate taxes only. When the order is paid, you must manually submit the transaction record to Avalara.
   • Calculation and submit: Use Avalara to calculate taxes, and when the order is paid, the Avalara Connector will automatically create a document and submit the transaction record to Avalara.

6. Select whether to Activate address verification. Then, click Connect account to complete setup.

   

Configuring Avalara Tax Settings

Setting Tax Codes for Product Types

Avalara Connector calculates taxes at the product level during checkout, based on the tax codes assigned to each product type. Follow the steps below to set tax codes:

1. In Tax settings, go to the Product tax code card and click Settings.

   

2. You'll see two tabs: Product type and Other types. Switch between them and enter the appropriate tax codes based on your business needs.

   Note: If the tax code for Logistic fee under Other types is left blank, the default code FR010000 will be used.

   

3. Fill in the tax codes. You have two ways to add them:

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  • Manual Input: Enter the tax code manually in the Tax code column for each product type.

  • Batch import: To add tax codes in bulk, export the CSV file, complete the sheet, and import it back into the system. The sheet contains two columns:

    Note: Product types under the Other types tab cannot be managed with a CSV file. Their tax codes must be entered manually.

    • ID: The unique identifier for each product type, visible on the Tax code page or in the exported CSV file.
    • TaxCode: Visit the Avalara Tax Codes Search page to find a suitable code.

4. (Optional) Add tax codes for multiple business locations. If you’ve set up multiple business locations for granular tax code management, use the dropdown menu in the upper-right corner to switch between business locations and assign the corresponding codes. For details on setting up multiple business locations, see the next section.

   Important: If you add a state business location, the system will prioritize the tax codes set for that location when calculating tax rates.

   

Adding a New Business Location

To support location-based tax management, SHOPLINE allows you to assign separate tax codes to different business locations. Follow these steps to add a new location:

1. In Tax settings, go to the Business location card and click Add location.

   

2. In the pop-up window, enter the following information:

   

   • Location name: Give the business location a name for easy management.
   • Business location: Enter the full address of this location.
   • Covered area: Choose whether this location covers the entire United States or a specific state/province.
3. Click Save.

Once the location is set up, go to the Product tax code settings page (see previous section) to assign tax codes for each business location.

Reminders for Accurate Tax Calculations

To ensure product taxes are calculated correctly based on your assigned tax codes, make sure the following configurations are in place:

• Each product is correctly associated with a product type on their product details page.
• Each product type is linked to the appropriate tax code.
• Logistics fee, Custom product, and Gift card types also need to have the corresponding tax codes configured (if applicable).

Calculating and Submitting Taxes Using Avalara Connector

If you choose to use Avalara Connector’s calculate and submit option (see Step 5 in the Connecting Avalara to SHOPLINE section), the connector will monitor subsequent order changes and automatically submit order transaction records to Avalara. Avalara will then assist with tax filing and refund processing.

Generating Transaction Records for Filing

Once an order is fully paid, Avalara Connector will automatically create the necessary documents and submit the transaction record to Avalara.

Orders that are not fully paid will not trigger document creation. During the transaction process, if you encounter a partially paid order, you will need to mark it as fully paid to generate tax records.

Multiple Tax and Refund Records from Order Changes

During the sales process, you may perform actions such as partial returns, exchanges, adding items to an order, or partial refunds. These operations change the order’s items or amounts.

After completing such changes, Avalara Connector calculates the resulting tax adjustments, determines which order data needs to be updated, and submits the updated records to Avalara.

This process may generate multiple tax and refund records due to the complexity of order modifications. These multiple records help ensure accurate tax adjustments.

Tax Refunds for Canceled Orders

A canceled order is considered a final transaction.

After canceling an order, Avalara Connector calculates the tax adjustments and submits the corresponding refund records to Avalara.