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Is an exemption required to make a taxable item nontaxable for a certain customer?

Overview

You have a customer purchasing an item which you believe should be non-taxable and you want to know if an exemption is required to make the system not charge tax for this particular customer.

Environment

Avalara AvaTax

Resolution

  • You can make a sale non-taxable for a particular customer by either applying an exemption, or making the item nontaxable by changing the tax code or creating a tax rule for their sale.
    • If you are trying to process the sale as a tax exempt sale, because the customer should not pay tax, add an exemption to the sale
    • If you are trying to process the sale as non-taxable, because the product is not taxable, change the tax code or add a tax rule