Create a Taxed Subscription with Avalara AvaTax

Use a taxed Subscription to confirm that Advanced Billing can calculate AvaTax sales tax for a taxable Plan or Product before you bill a customer for it.

Before you start

Confirm your AvaTax setup and tax calculation data are complete before creating a taxed Subscription. Missing addresses or taxability settings can prevent tax from calculating correctly.

• AvaTax is connected in Advanced Billing.
• The tax origin address is complete.
• The Plan or Product is marked taxable, with Require Shipping Address at signup? checked and a Tax Type assigned.
• The customer record includes a complete shipping or billing address.

Step 1: Confirm the Plan or Product is taxable

The catalog controls which Plans and Products are taxable. Review the catalog before creating the Subscription so AvaTax receives the correct line item details.

1. Edit the Plan or Product in Advanced Billing.
2. Confirm This Plan is subject to taxes is checked.
3. Confirm a Tax Type (Digital Service or Physical Good) is assigned.

Step 2: Create the customer record

The customer record must include a complete shipping or billing address, formatted using the required ISO country and state codes. AvaTax uses this destination address to calculate the applicable tax.

1. Enter the customer's shipping or billing address, following the required address format.
2. Confirm the address is complete. A partial address, such as country and zip code alone, means the subscriber isn't charged tax.

Step 3: Create the subscription and preview tax

After the catalog and customer record are ready, create the Subscription and preview the cost before finalizing it.

1. Add the taxable Plan or Product to the subscription.
2. Preview the cost or invoice to confirm tax calculates as expected. This calls AvaTax for a live, non-committing calculation, so previewing doesn't post anything to Avalara.
3. Complete signup, or finalize the invoice, to bill the customer. If Post documents to Avalara is enabled, this also posts the transaction to Avalara.

Test before going live

1. Create a test customer in Advanced Billing with a full address.
2. Run a sample subscription, invoice, void, and refund.
3. If Post documents to Avalara is enabled, confirm the transaction appears in the AvaTax Admin Console with the expected jurisdiction and amount.