How does Avalara calculate tax on Shipping Items and Shipping Cost?

Hello all!

Although I am over simplifying, to allow Avalara to calculate tax on an item, you must create an AVAITEMMAPPING record for each Item. There are scripts deployed to different item types like check if there is an AVAITEMMAPPING record, then sets a hidden Item Field for AvaTax Code and uses this code when transactions are created. There is a User Event script deployed to transactions that calls Avalara’s API and returns the tax amount.

This is all working great with exception to Shipping Items. We have been using the Native functionality to calculate Shipping Amounts based on the Shipping Method we select. However, we are seeing that Avalara does not accurately calculate the tax on the Shipping Cost.

Has anyone figured out how Avalara handles taxes on Shipping cost?  

I see there is a Shipping Code list in the Avalara Setup section, but entering those values only allows you to set a Shipping Code ID and a Description, with no mapping to NetSuite native shipping items.

 

Any/all help on this is much appreciated! The documentation is pretty ambiguous so specific steps will also be valuable.

Rookie Asked on May 18, 2020 in Taxation.
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