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How can I exempt customers in AvaTax for Salesforce?

Overview

This article covers the two ways that you can make a customer exempt using AvaTax for Salesforce.

Environment

SalesForce

Resolution

  • Essentially, you can use the non-taxable checkbox, or setup an exemption certificate on the AvaTax Admin Console for the appropriate customer code.
    • The simplest way to exempt a customer is to use the non-taxable checkbox on the Opportunity or Quote in Salesforce. The checkbox can be placed freely anywhere on the Opportunity or Quotes layout. It would look like this:
    • It may also be that the checkbox is not yet part of the layout you are using.
      • If you edit the page layout you can see if this is the case.
      • The below picture is the non-taxable checkbox for Opportunities. Since it is not grayed out, we can tell this layout doesn't have the checkbox added yet.
      • You can drag it down to the preferred location, just like with other Salesforce fields. 
    • The specifics of how this works is simple. AvaTax has an Exemption Number field as part of its API.
      • When this box is checked, the Opportunity or Quote will send "Exempt Customer" in that field.
      • When it is not checked, no data is sent in that field.
      • For this method to successfully exempt customers, the ECMS settings in AvaTax must be set to "Optional".
  • The preferred way to exempt customers is to use exemption certificate records on the AvaTax Admin Console to let AvaTax know that a specific customer code should not be taxed in a specific state or states.
    • In order to do this you need to have access to the AvaTax Admin Console.
    • You also need to know the customer code that will be passed through for the Account used in the Opportunity or Quote.
    • By default the customer code is the unique account identifier that Salesforce uses. An example is below:  
    • If you do not want to use that, you can switch to using the Account Name instead.
      • Go to the TaxNow Settings in Salesforce and you can check the box below in your settings. 
      • This will make it so the customer code will simply be the Account Name, which is much easier to find, but is not necessarily always unique.
        •  
    • Once you are in the AvaTax Admin Console and know the customer code, go to Organization.
      • On the right-hand side you should have an icon to access exemption certificates.
        • If not, you will need to turn on ECMS, which can be done from the Settings tab.
      • From the Exemption Certificates screen, create a new certificate and make sure the customer code is appropriate and that you have added the state(s) that the customer is exempt in.