Gift Cards & Shopify and Avalara Integration

[artiu1976]

Hi,

For those of you who have Avalara tax software natively integrated to your Shopify account, how do you manage gift cards? We have noticed that gift card purchases flow into Avalara and Avalara counts these purchases towards gross revenue (even though it's a liability). Then, when the gift cards are redeemed, it is again counted towards revenue in Avalara. This is not accurate and we went up having inaccurate gross revenue.

I have brought this up to both Shopify Plus Support and Avalara support and keep getting ping-ponged around that this is the other's responsibility. 

How do you internally manage this discrepancy so that you have accurate reporting? Is there a setting or something we're missing?

Thanks!

[GLC-Finance]

I think you just need to assign the correct product tax code so it's non-taxable. It works for me.

[artiu1976]

@GLC-Finance The issue isn't that the gift card is being taxed but Avalara counts it as revenue when the gift card is purchased and when it's redeemed. This throws off our total revenue in Avalara because the gift card purchase and redemption is counted towards revenue. 

[GLC-Finance]

I would guess it has to do with the way the product/variant was set up in Shopify. I'd recommend checking the json data for the gift card variant and making sure it's shows taxable as false and requires shipping as false (that is if it's a digital gift card). You can view this by adding .json to the URL when on the page to edit the variant details. If it's says taxable is true, then you'll need to make a change to the tax code in Shopify.