Tax ManagementEdit on GitHub
Adhere to the respective tax regulations in the countries you sell and effortlessly configure and manage tax rates for products, shipments, and additional services.
Available tax providers
|TAX PROVIDER||BUILT AND MAINTAINED BY||AVAILABLE FROM||BUSINESS MODEL SUPPORTED||SUITABLE WHEN||CAN BE EXTENDED AND CUSTOMIZED|
|Avalara||Avalara||Composer||B2C||You do business primarily in North America.||From the Avalara Admin panel, you can customize all the tax rules of your business.|
|Spryker Tax||Spryker||Composer||B2B, B2C, Marketplace||You do business primarily in Europe and in the countries where tax systems are simple.||While you still need a development team to customize the tax experience, some parts can be customized in Spryker Back Office.|
|Vertex||Spryker||ACP||Marketplace||You do business primarily in North America.||From the Vertex Admin panel, you can customize all the tax rules of your business.|
The following are some key usages and values of a tax engine in the ecommerce context.
Automated tax calculation
A tax engine automates the complex process of calculating taxes for online transactions. It integrates with the ecommerce platform and considers various factors such as the customer’s location, the seller’s location, product type, and applicable tax laws and regulations. By automating tax calculations, businesses can ensure accuracy, reduce manual errors, and save time and resources that would otherwise be spent on manual tax calculations.
Compliance with tax laws
Tax regulations can be intricate and constantly changing, making it challenging for businesses to keep up. A tax engine stays up to date with the latest tax laws, rates, and jurisdictions. It ensures that the correct taxes are applied based on the specific location and products involved in the transaction. Businesses can avoid penalties, legal issues, and reputational damage by ensuring compliance with tax laws.
Real-time tax rates
Tax rates can vary depending on the customer’s location and the products being sold. A tax engine provides real-time tax rate information, eliminating the need for businesses to manually research and update tax rates. This real-time functionality ensures accurate tax calculations, regardless of changes in tax rates or jurisdictions.
Seamless international sales
For ecommerce businesses operating across borders, dealing with international taxes can be complex. A tax engine simplifies the process by automatically calculating and applying the appropriate taxes for each international transaction. It takes into account factors such as import duties, value-added taxes (VAT), or goods and services taxes (GST). This simplification enables businesses to expand their customer base globally and facilitates international sales without the burden of navigating complex tax regulations.
Transparency and customer trust
Clear and transparent tax calculations contribute to customer trust. By providing accurate and transparent tax breakdowns during the checkout process, businesses build credibility and avoid any potential confusion or disputes with customers regarding taxes. This transparency strengthens the overall customer experience and fosters trust in the brand.
Audit trail and reporting
A tax engine maintains a comprehensive audit trail of tax calculations, ensuring businesses have a record of all transactions and associated taxes. This audit trail can be used for internal purposes, such as financial reporting, as well as for external entities like tax authorities during audits or compliance checks. The ability to generate accurate tax reports simplifies tax filing processes and helps businesses maintain proper financial records.
Scalability and efficiency
As an ecommerce business grows, the volume of transactions and tax calculations increases significantly. A tax engine can handle a large volume of transactions efficiently and accurately, even during peak periods. It ensures scalability and reliability, allowing businesses to focus on core operations and growth strategies, rather than dedicating excessive resources to manual tax calculations.
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