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Calculate Sales Tax

This article applies to:Avalara AvaTax for NetSuite

After you set up and configure AvaTax for NetSuite and set customer taxability, AvaTax for NetSuite calculates sales tax on the following transaction types:

  • Estimates
  • Orders
  • Invoices
  • Cash sales
  • Return authorizations
  • Credit memos
  • Cash refunds

Simply create one of those transaction types and click Save. AvaTax for NetSuite use the customer's bill-to address to calculate the correct sales tax. If you want to calculate and view the tax details for a line item or before saving the transaction, click Calculate Tax.  

Note:

If you're applying discounts, please take the following information into consideration:

  • The header-level discount is applied to all the taxable items in the transaction
  • The line-level discount is applied to the item above the discount row
  • If both, the header-level and the line-level, discounts are applied, then their cumulative discount is applied to the line item.

Post the following transaction types from NetSuite to the Admin Console:

  • Invoices
  • Cash sales
  • Credit memos
  • Cash refunds

Calculate sales tax using a ship-to address

AvaTax for NetSuite can also use a customer's ship-to address to calculate sales tax. Here's how:
 

  1. Create any of the above transaction types, and on the bottom toolbar, click Address.
  2. In the address pane, at the right under SHIP-TO SELECT, select the ship-to address for the transaction.
  3. At the lower left, click Save.

    NetSuite2014_CalcTaxbyShipTo1.png

Calculate sales tax by latitude and longitude

If a customer has a location such as an oil-rig, drilling platform, or radio antenna that has no street address, you can still calculate sales tax on that location by latitude and longitude. Here's how:
 

  1. On the NetSuite toolbar, on the Lists menu, point to Relationships and then click Customers.
  2. In the Customers pane, at the left under Edit next to the customer's name, click Edit. The entire customer record must be in edit mode to enter coordinates, otherwise you can only edit the address.

    NetSuite2014_CalcTaxbyLatLong1.png
  3. In the Customer pane, on the bottom toolbar, click Address.
  4. Next to the customer's address, under LATITUDE, click once.
  5. In the LATITUDE text box, type the customer's latitude in decimal format. (To convert coordinates in degrees/minutes/seconds format to decimal degrees format, try the online converter on federal communication commission's latitude/longitude conversions.)
  6. Under LONGITUDE, click once.
  7. In the LONGITUDE text box, type the customer's latitude in decimal format.
  8. At the lower left, click Save.

    NetSuite2014_CalcTaxbyLatLong2.png

Now whenever you create a a transaction for this customer, AvaTax for NetSuite will use the latitude and longitude that you specified to calculate the correct tax.

Calculate sales tax in the NetSuite Web Store

To calculate sales tax on orders in the NetSuite before you submit them to NetSuite, follow the steps below:
 

  1. Go to Setup > Site Builder > Setup Website.
  2. Click Edit on the correct website.
  3. On the Setup tab, click Scriptable Cart and Checkout.
  4. Click OK.

    NS-ScritpableCartandCheckout.png

Adjust sales tax on credit memos

To adjust sales tax on credit memo transactions, ensure that the transaction has:

  • Amount to be credited in the Tax Credit field
  • A non-inventory item called Sales tax adjustment with a line amount as 0

Once you create a credit memo, NetSuite sends a return invoice to AvaTax. Use the current day's date on the credit memo to avoid errors if the credit occurs in a locked period.

To adjust sales tax on credit memos, follow these steps:

  1. Go to Lists > Accounting > Items and click New.
  2. On the New Item page, under Item Type > Non-Inventory Item, click For Sale
  3. On the Non-Inventory Item for Sale page, create a non-inventory item Sales Tax Adjustment. Go to the Sales / Pricing tab and in Price Levels, type Base Price as 0.
  4. Go to Transactions > Customers and click Issue Credit Memos
  5. On the Credit Memo page, add details. Ensure that: 
    1. The amount to be credited is added in the Tax Credit field. This amount is used as the tax override amount.
    2. For a line item, the Item is selected as Sales Tax Adjustment and the line Amount is 0. If the line amount is not 0, then the "Sales Tax Adjustment's line amount should be zero" message is displayed.
  6. Click Save

    TaxCredit.png