The tax thing is pretty new to me. In the process of shopping for tax services, I’ve noticed quite some options were in people’s discussion. Can you compare Shopify Tax, Avalara, Kingtsugi, TaxCloud, and Taxwire? What are they good for and for what businesses? Thanks!
Hello!
It really depends on what you’re looking for; each service focuses in slightly different areas.
Shopify Tax is our paid tax service designed for merchants selling in the United States, European Union, or United Kingdom. It:
- Tracks liability and alerts you to when and where you should consider registering for taxes
- Calculates tax on each of your orders at address-level precision
- Automates tax rate exemptions based upon the category set for each of your products
Depending upon your geography and sales channels, it may also:
- Provide enhanced tax reporting
- Automatically file your sales tax for you [separate u.s. product]
- Validate VAT numbers [opt in]
- Send VAT invoices [opt in]
We recommend that merchants consider additional partners if:
- Desire an end to end managed service inclusive of registrations
- Registered via SST in the U.S.
- Want control / ability to custom or be more granular at how tax rates are applied
- Are heavy B2B (want to create and manage exemption certifications)
- Sell products requiring excise taxes
Only two other companies today are able to offer end to end on Shopify: Avalara and Vertex. For companies like Numeral, Kintsugi, TaxCloud, Taxwire, etc, you would need to use Shopify to power the rate calculation and then those services for the other aspects of sales tax management.