For all the eCommerce business owners out there, you might be struggling with your taxes. Whether you are selling on Amazon or you own an eCommerce store that runs on Shopify, taxes are always a big issue. You will be spending a lot of time every single month counting your taxes, right?
Well, we have a solution for you. You can use taxation software to help with these things. We will see a complete comparison of Avalara vs. TaxJar. Both of these are the best tax software that you can use.
Let’s start with Avalara vs. TaxJar.
Overview of Avalara vs. TaxJar
We will begin with all the basic intro where we will see the overview of both of these software types. Once you know this, you can proceed further and know more about these.
Avalara is an automated tax solution that is easy, fast as well as it is accurate. It works on the cloud and will give the tax calculation of all the products. It’s available in many countries. The tax will be calculated based on the location, regulation, and item. Avalara is one of the oldest tax companies. It was founded back in 2004.
On the other hand, we have TaxJar which is a very small software. Taxjar will automate all the sales tax reporting and will also allow you to file it from the same software. The software is truly automated as it works directly on the API. Taxjar is new if you compare it with Avalara. It was founded in 2012.
Let’s begin with the comparison and see which is the best software among the two competitors.
As it’s tax software, we will start with the tax services. This is where we will see the top tax services offered by the tools.
At first, we will see the common services that are offered by both of them. Thereafter, we will talk more about the services that a particular provider is giving.
- Address validation
- Audit trial
- Exemption management
- Tax calculation and filing
- Taxability verification
- Transaction tracking
These are the services that are offered by both of the tools. Now, there are two main services that you might need if you are working with eCommerce. It will VAT and Consumer uses tax. Both of these are only available in Avalara. Taxjar doesn’t provide the two features.
There are many other features in both of these tools.
Winner: If you talk about the services, we would say that Avalara is the winner here as there are more services given in this provider.
What if the software makes some mistake? You should look for some guarantee, right?
Well, TaxJar will give you a 2x guarantee. In simpler words, if there are any conflicts, you will get 2x money of whatever you paid them over the past 1 year (12 months). Isn’t this great?
Also, there is a specific period in which you will have to notify them. TaxJar will give you 14 days to notify them. This is enough time to check all the things.
On the other hand, we have got Avalara. Even they have a guarantee. You will get a 100% guarantee here. In simpler words, you will get all the money back for what you paid as Avatax. There are 10 days given to notify them in case of any conflict which is very less as compared to TaxJar.
However, if we see the same things from a broader perceptive, both of them are accurate and will give you the best results.
Winner: When talking about Avalara vs. TaxJar, we would say that TaxJar is the clear winner here.
Dispute and Filling
You might also want to know about the dispute and filling issues. When it comes to tax, there are many such things that you need to pay attention to.
Both of the software will file the return on time. Taxjar gives you a guarantee that they will file the return on time every single year. If they fail to do so, they will pay the penalties and interest. The filling guarantee is involved here.
In case of any disputes, Avalara will include the rebilling of the customer’s uncollected tax. However, Taxjar has a different concept here. Here, they will never involve the customer in case of any dispute. You can surely chat with the support team to know how they will handle it.
Winner: We will say that Taxjar is a clear winner here. Tax filing is not a big issue as the software will surely do it. However, the tax dispute is a big issue for most people.
The next thing you might want to know about is the pricing. Pricing will play a very important role here. if you are a small business, you will have to make sure that the pricing is within your budget.
Pricing will determine whether you will use the software or not. For startups and small businesses, it’s important to control the budget and ensure that you are getting the best services at a very reasonable price. Therefore, you will have to pay special attention to the cost.
The pricing for Taxjar starts from $19 per month. You can choose any plan that you want. They even have a free trial of 30 days. You can sign up and use the software for free.
On the other hand, we don’t have any pricing information for Avalara. Here, you will find the “Request a quote” button from which you can enter your details and contact them. Their team will get back to you and ask you for further information.
You can contact them and ask the pricing. If you are a person who doesn’t want to contact them and wait for a response, you can directly go with Taxjar. Here, you don’t need to contact any team member. You can directly get started with the software. As we mentioned, they even have a free trial where you can sign up and try the software.
Winner: We can’t decide the winner here. Therefore, we will keep it as a draw. We only have one side over here. If we don’t have the exact pricing from both the side, it will be unfair to declare the results.
Integration and Automation
Now comes the main thing for which you are waiting for. When we said “Automated”, you had a lot of things in your mind, right?
We are going to solve all of them and tell you how both of these software are automated.
Let’s talk about Avalara first in Avalara vs. TaxJar battle.
Avalara will provide you automated filing with the help of CSV. You will have to download the CSV from Amazon or from any place where you are selling. Thereafter, you will have to reformat it as per the Avatax requirements. They have certain requirements on how the CSV file should be. Once you do that, you are all set to upload it. Don’t worry, the formatting will hardly take few minutes. You will have to do this process every single month.
On the other hand, we have got Taxjar which will automate your tax. It connects easily with Amazon and Shopify. The API will collect the data directly from there. You won’t have to worry about the CSV. You don’t even have to download the CSV here. All the things will be done automatically. Taxjar was made for multi-channel and the features are showing you that you can automate all the things here.
Winner: The winner is pretty clear here. You might have already guessed who it is. Yes, it’s Taxjar. You can automate all the things here.
Ease of Use
Both of these are easy to use. As you are running an eCommerce business, you might have great knowledge of how to handle software. Therefore, we won’t be focusing too much on this section.
We will see it in brief so that you will have a clear understanding about it. Generally, people want easy-to-use software because it will save them time.
Here, we would say that Taxjar is easy to use as you don’t need to download the CSV and do all the things. Avalara has a bit of work that you have to do. However, the user interface is great.
There are some of the people who were facing issues when signing up with Taxjar. Luckily, there is a free 30 days trial. You can sign up yourself and see if that’s an issue for you or not.
Winner: We will declare this as a draw. Both of them have a great UI and are easy to use. Being an eCommerce business owner, you can use any of them easily.
You might ignore the software if it’s just another tool that you are using. However, when you are using any standard tools which have something to do with tax compliance. You will need to make sure that the support team is good and its easy to contact the support. Without this, you will never be satisfied with the service. Also, there might be some issues with the taxes. Therefore, it’s always better to know that you are having the best level of support.
Both of the companies have support in the following ways.
- Email/help desk/ticket system
- Phone support
You can contact them in any way you want. The support of Taxjar is better than Avalara. Their support team will help you whenever you need it with the best possible solution.
Not to mention, Taxjar is fully online whereas Avalara has offices in various places.
The next thing that you need to know which goes along with the support is the training. If you are facing issues with the software, their team can help you with it. You will get videos, documentation, live online training, and periodic webinars where you will learn many things about the software.
Avalara goes one step ahead here. They also provide you in-person training as well. This is because they already have offices.
Winner: If you talk about the support team helping guidance, Taxjar wins here. However, if you talk about the mode of contact, Avalara has more options to contact the support team. You can choose the winner accordingly. In our opinion, Taxjar is the winner here.
User Description – Best suited for?
Now comes another amazing part. Who are the users of these tools? We saw all the things till now.
If you are a regular reader of our blog, you might know that every website has a different userbase. Some of the companies might be targeting the X type of people and some companies might be targeting the Y type of people. Unless you know the user base, you can’t say that you know everything about the company.
Taxjar mostly has an audience of small businesses and medium-sized businesses. As the software is automated and allows you to do all the things at a very affordable rate, small businesses often prefer this software/company.
On the other hand, Avalara has most of the audiences that have an enterprise-level business. They even have medium-size businesses in their userbase.
The reviews of both of the software are positive. If you compare the reviews from all the popular places, Taxjar has slightly better reviews than Avalara.
You can choose the one that suits you the most.
Which one to choose?
Now, the last question that every single person has is which one should I choose. Avalara vs. TaxJar was a tough completion and both of these companies have done great.
As you can see that Taxjar has done better than Avalara in various factors. So, our recommendation will be Taxjar. You can sign up for the free trial and see what things you will get.
You can also contact the Avalara team to get the pricing.
Lastly, it’s all about choosing the company that suits your need.