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Avalara Help Center

Calculate Sales Tax

This article applies to:Avalara AvaTax for Open Cart

As long as you enable tax calculation and select AvaTax as the tax calculation method in your accounting software, AvaTax automatically calculates a sales or use tax rate on a variety of transaction types according to the taxability rules of those products (exempt customers aren't charged sales tax):

  • Estimates/quotes
  • Orders/invoices/cash sales
  • Return authorizations/credit memos/cash refunds

Create one of these transaction types in your accounting software. AvaTax uses the customer's ship-to address to calculate the correct sales tax.

If you're applying discounts, remember:

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

To calculate sales tax, ensure that the Enable AvaTax tax calculation is configured and the address is available. 

Address details for tax calculation

For a transaction, tax is calculated based on the ship-to address. If the ship-to address is not available, then the bill-to address is used for tax calculation. If both, the ship-to address and the bill-to address, are not available, then tax is not calculated for the transaction.

Calculate sales tax on a transaction

When you confirm an order in OpenCart, it exchanges data with AvaTax to calculate sales tax as shown below.

OC_Sales_Tax_Checkout.png

 

Calculate sales tax on handling fees

To use AvaTax for OpenCart to calculate sales tax on handling fees, follow these steps:

  1. On the OpenCart Administration page, click the Extensions tab, and then click Order Totals.
  2. On the Handling Fee line, click Edit.

    OC_Sales_Tax_Admin_Panel_Handling_Fee.png
  3. Next to Status, click Enabled.
    OC_Sales_Tax_Admin_Panel_Handling_Fee_Status.png
     
  4. When a customer checks out, they'll see a separate line for Handling Fee and AvaTax will calculate and apply sales tax on the same.

    OC_Sales_Tax_Handling_Fee_Checkout.png

Assign and use non-taxable class

To avoid calculating tax on certain products, assign them a non-taxable class. To assign a non-taxable class to a product, follow these steps:

  1. In the OpenCart admin panel, go to System > Localisation > Taxes > Tax Classes.
  2. On the Tax Classes page, click Add New (+) to add a tax class.
  3. On the Add Tax Class page, type the Tax Class Title as Non Taxable and give a suitable description. Click Save.

    OC_Sales_Tax_Non_Taxable_Add_New_Class.png

  4. On the Tax Classes page, this new tax class is now added to the Tax Class List.
  5. To assign the non-taxable class to a product:
    1. Go to Catalog > Products
    2. Select the product and click Edit
    3. On the Edit Product page, go to the Data tab and in Tax Class, select Non Taxable and click Save. Now whenever this product is selected, sales tax is not calculated on this product. Tax is only calculated on amounts like Handling Fees and Flat Shipping Rate as applicable.

    OC_Sales_Tax_Non_Taxable_Product_Assignment.png

Save transactions to both OpenCart and AvaTax

To save transactions to both the OpenCart Admin panel and the Admin Console, follow these steps:

  1. In OpenCart, go to Admin > System > Settings > AvaTax.
  2. In the Customer Specific Settings screen, next to Do you want to save transaction on AvaTax, click Yes.

    OC_Sales_Tax_Configuration_Save_Transaction.png

  3. Create an order or other transaction and save it. If you click Yes in the screen above, any transaction that you save are saved to both, the OpenCart administration panel and the Admin Console panel, as shown in the screen below:

    OC_Sales_Tax_Order_Information.png