Item: Avalara
Rating: 8
Author: Verified User

Use Cases and Deployment Scope

We use AvaTax Excise to calculate taxes for our fuel business. Tax calls are made from our ERP to Avalara and taxes are returned for billing and purchasing. It is managed by the tax department. It is our solution for tax calculation. We use Avalara Returns to calculate the motor fuel tax returns to report to the states for where we sell fuel.

Pros and Cons

Visibility of the rules that apply to the transactions.
Reliable connection for the tax calls and cloud application.
The ability to customize the program for specific customer/vendor issues you may have.

The customer service process takes a while to respond, sometimes more than a day for non-critical issues.
There's a bit of a learning curve to understand the Scenarios and Profiles that drive the rules and how they interact.
I would like to see more sales tax functionality in the AvaTax Excise. It has the basic calculations for motor fuel, but I want to use for other product lines.

Return on Investment

We haven't seen a lot of time savings yet, but we concurrently did an ERP implementation, so there were more accounting and billing problems that resulted in more work on the returns. This isn't due to Avalara though. We are working through amended returns to fix all these past situations.
The configuration we have is good for preparing the returns and getting them out the door, but we still do some things manually that I plan on automating with rules in Avalara in the future. I expect that when these are implemented, we will have time savings on return preparation.
The main time drain is on general ledger account reconciliations. When Avalara did our implementation, they showed us a reconciliation method and which Avalara reports work best for that process. It really helped the tax department in the transition and is still used today.

Implementation Rating

The implementation team from Avalara was very knowledgable and did a good job of passing along information so that we could maintain the system and be able to make future changes ourselves. We had asked for some custom tax setup and they worked with us to get additional taxes set up that they didn't previously have. They worked with us to pull our documentation on tax rules and make sure those were included. I had hoped more scenarios would be there out of the box to cut down on the configuration time.

Systems Integrated With

It makes a tax call to return taxes on every transaction if needed. We used a connector mapped to Avalara. There were some customizations we needed to make in SAP to handle the taxes. Examples were to adjust the pricing procedure to record the Avalara taxes as pricing conditions, deferred tax invoicing, and accounting for deferred taxes. It was moderately difficult, as our SAP implementation consultants were not familiar with Avalara and were not recording the taxes as "taxes" in SAP, but Pricing Conditions caused different accounting postings that had to be resolved.

Usability

Avalara is very user-friendly for tax preparers. It is relatively easy to view how the tax was calculated and to modify rules. We are happy we don't need a programmer to do this! Connectivity is good, although, with the Returns product, there is some slowness in processing as it gets close to tax deadlines.

Additional Capabilities

We have not used this, but are currently looking into exemption Certificate management.

Likelihood to Recommend

I feel it is the best solution for motor fuel taxes in the marketplace. It has good visibility and is user-friendly for the tax preparers. It has comprehensive rates and they are updated monthly (automatically if you are on the SAAS product). If you have one-off scenarios with different customers and vendors, it is easy to handle those.

Fuel distributor uses Avalara to calculate Excise Taxes with SAP and file returns

Modules Used

Overall Satisfaction with Avalara