Taxjar Integration

Taxjar Integration

ERPNext users can utilize the TaxJar interface to automatically calculate taxes depending on the addresses of clients, businesses, and delivery locations.

How to Setup TaxJar?

TaxJar Account and API Tokens:

To set up Taxjar, you'll need your account's API tokens.

1. First, create a Taxjar account in accordance with your needs.

2. After logging in, go to the account dashboard, click the Account icon, and then select TaxJar API from the dropdown menu.

3. Now that you have your API tokens visible, you may configure your ERPNext TaxJar integration using them.

Adding Nexus and states in TaxJar: What is Nexus?

In every state, you are not need to register in order to collect sales taxes from customers. Only clients who reside in the states where you have nexus will you be required to collect sales taxes from.

An association with a state known as "nexus" must be sufficiently strong for you to be subject to its sales tax regulations.

How do I know where I have Nexus?

You will always have a nexus in the state in which you currently reside.

Please be sure to read up on Nexus on the TaxJar website for further information.

Adding states: Please follow the comprehensive instructions provided on the TaxJar official page here for adding/removing states from your dashboard. Doing so will help you set up everything precisely.

Setting up TaxJar on ERPNext: Find "TaxJar Settings" by searching the awesomebar. With ERPNext, this is where you configure the TaxJar integration.

Sandbox Mode: For automated testing and development, TaxJar offers a sandbox environment. Point your API client to the sandbox environment after creating a sandbox API token at https://api.sandbox.taxjar .com]

Setting up tokens and account heads: 1. Create a TaxJar transaction and enable tax calculation: 2. You must activate these options for auto tax computations in order for you to track and analyze the tax breakdowns of the transactions that appear on your TaxJar account transactions page. 3. As soon as you complete a transaction, it will automatically show up on your TaxJar Transactions page: 4. You can review all of the completed transactions as well as the comprehensive tax breakdowns. 5. After following the instructions above, copy the API tokens from your TaxJar account and put them in the Live API Key and Sandbox API Key fields. 6. You must set up two account heads for taxes and shipping, choose the appropriate accounts, and then click save when you are finished configuring everything.

Setting correct addresses Please make sure you have generated accurate addresses for your business, clients, suppliers, etc. if you want the integration to run well.

Note 1. Verify that you provide the right state in the State/Province field when generating an address. Although New York is referred to as NY in TaxJar, there is no requirement that you enter it that way; the system will automatically convert it to the 2-letter state code.

2. To save time and effort, you can select the Preferred Billing Address and Preferred Shipment Address checkboxes to automatically fill up those entries on various invoices.

By selecting the Preferred Billing Address and Preferred Shipping Address checkboxes, you can save time by having those fields automatically fill in on different invoices.

3. Verify that the City/Town, State/Province, Country, and Postal Code fields are complete.

4. You might want to remove any taxes that are automatically imposed.

TaxJar in Action!

In this case, a sales invoice is being sent to a client who is also a resident of New York by a corporation with its headquarters there.

As you can see, the state-specific taxes and fees are immediately applied when you save.