How taxes are calculated in CRM
- Susanna Romanelli (Unlicensed)
How taxes are calculated
To calculate taxes, there are two specific events during the Sale Workflow:
At the Checkout level, our Tax API calls the Tax Provider (Avalara, TaxJar, or DFO) that was previously configured on the campaign to know the percentage of tax for the product
While an Order is created, the Tax API calls the Tax Provider (Avalara, TaxJar, or DFO) configured on the campaign to calculate the percentage of tax for the product. Additionally, the system will record this transaction on the Tax provider Dashboard (Avalara or TaxJar)
Please note that for the client Ontel, the 2nd step has been removed as the per the client’s request.
To adjust the 2nd point to each user/client's request, on the Campaign Settings page can be used the toggle Create tax transaction?
When the toggle Create tax transaction? is set to ON, the system will record the tax transaction on the Tax Provider Dashboard (Avalara or TaxJar) when creating an order.
On the contrary, when the toggle Create tax transaction? is set to OFF, then no tax transaction will be recorded on the Tax Provider Dashboard (Avalara or TaxJar) when creating an order.
How taxes are calculated in CRM?
In CRM have been implemented two different tax providers, such as:
DFO
Avalara
TaxJar
These Tax Providers are working differently.
Avalara and TaxJar are a third parties provider that has been integrated into CRM.
How calculated taxes using the DFO feature
The DFO tax system allows users to set the percentage of tax in the Sales Model section
Each Sale Model has a section called: Tax configuration, where users can easily set the following:
The Tax Percentage
The Country or Countries
How to set up Taxes in a CRM Campaign?
Please follow the below steps to set the taxes into the campaign.
From the left side menu, click on Campaign Management> Settings
Click on the Create New button to build a new campaign
On the Campaign page, please go to the right side of the page and select the Campaign Settings, from the listed topics
Then Payment Settings, and a few options are available, such as:
The toggle Allow Pre authorization: when turned ON will allow the purchases to be verified by a 2-step authorization, where the payment provider would receive the information of a new transaction, and only after the payment provider replies authorizing it, the transaction would be completed.
The toggle Charge Tax.: having turned to ON will allow the user to decide whether DFO or a third party company called Avalara or TaxJar would process the calculation of all taxes involved in the transaction, calculating them by country rule, depending on where the product was configured to be available at.
The toggle Allow check and cash: when set to ON, the campaign will allow users to place new orders by paying with a check or in cash
Is the toggle Tax included in price? that have the tax embedded into the order grand total (for example the product is sold for $100 on the website, customers are paying $100 and on this $100, there is the percentage of taxes already) or separate from the cost of the product (for example the product cost $90 on the website, but at the end, customers are charged $100, because $10 are taxes).
The toggle Create tax transaction?: By switching to ON the toggle Create Tax Transaction?, if the campaign has been set to charge taxes (Avalara or TaxJar) to customers, then this value is recorded on the Tax Provider Dashboard. On the contrary, when the toggle Create tax transaction? is set to OFF, then no tax transaction will be recorded on the Tax Provider Dashboard (Avalara or TaxJar) when creating an order.
Tax Provider field with a small drop-down menu, where the user can choose the tax provider.
6. Once all the campaign and tax provider details have been set, click on the green Save button
Please note that if DFO has been set as Tax Provider, users can add the specific Sales Model to the Campaign by following the below steps:
From the Campaign Settings page, scroll down to the Product area
Fill the product details, including pick one of the Sales Models available from the drop-down menu (see the below example)
Avalara & TaxJar and the Committed & Uncommitted Transactions
For both Avalara and TaxJar dashboards, transactions are grouped as below.
Committed: These are the ones for which payment has been successfully confirmed, and an order is created in CRM.
Uncommitted: These are the ones for which payments have been declined or cancelled and so there are no orders
Thus, in CRM the orders are marked with the status Cancel or Abandon (see the below examples)