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How can I enter a credit for tax only in the Admin Console?


You chose to write off tax in your accounting software on a credit memo, but that memo isn't in AvaTax. You want to update AvaTax to include the same credit, so reports match. It's a best practice to add a credit and re-bill to allocate the tax calculation to the correct jurisdictions.

Avalara doesn't recommend performing a tax only credit as this can cause inaccurate reporting for your returns. If you haven't yet filed returns with the relevant transactions, adjust the transactions to correct any calculations. If you can't edit the relevant transactions (if they're locked due to having been used in Returns, for example), create a tax only credit.

Tax only credits can only be applied at the line-level. They can't be applied at the document-level. You can create them manually or through a bulk import, as described below.




Manual Entry

  • In AvaTax, go to the Transactions tab.
  • Click New to create a new transaction.
  • Fill out all required information on the Documents tab including origin and destination address. Be sure to use a unique Doc Code. The Document Code, Tax Date, Document Date, and Addresses depend on your original sale and the reporting period you need the transaction to appear in. If the credit should be applied to the current term, use the current date.
    • If you need to tie it to an existing invoice add a unique identifier to it. For example, the original invoice number was INV123, the new invoice number would be INV123_CR.
    • Tax only credits can only be applied at the line-level. They can't be applied at the document-level.
  • On the Lines tab enter 1 line with a QTY of 1 and Amount of 0
    • Add a Tax Amount Override for the amount of tax you want to credit.
      • Select the Tax Override Type as .TaxAmount
      • Enter the amount as a Negative Value.
      • Click Add.
  • Click Calculate, on the left,  to ensure all required fields are filled out.
  • Click Save as Committed.

Entry via Import

Follow the import transactions instructions:

  • Use the for information in designated columns in additional to other required information:
    • Column A - 2 (tax override without sales tax calculation)
    • Column C - 5 (Return invoice)
    • Column N - 0 (there should be no amount)
    • Column AP - negative tax amount (use - symbol)
  • Reminder:  please complete additional required fields