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Where is FR030000 taxable?

Overview

You want to know in which areas the taxability of the freight tax code FR030000 for "Shipping And Handling Combined" depends on whether the items in the transaction are also taxable.

Environment

Avalara AvaTax

 

Resolution

  • You can test the taxability of freight using a transaction import or the Advanced Tax Calculator:
    • Create a transaction including 3 line items
      • $1 Freight with the tax code FR030000
      • A $1 nontaxable item 
      • A $1 taxable item
  • Where it is "tax depends" state the freight charge will taxed on half the value
  • Where it is non taxable (or where you do not collect) there will be no tax on the freight
  • Where it is taxable there will be tax on the freight
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