Set up tax

Tabs integrates with tax automation providers to calculate, apply, and report sales tax on invoices. This guide explains how to connect a tax provider and map tax codes to Items.

Supported tax providers

Step 1: Connect your tax provider

Configure tax provider connections in the Tabs app. To connect your provider:

1. Go to the settings page in the Tabs app.
2. Select your tax provider (Anrok, Avalara, or Sphere).
3. Enter your API credentials for the provider.

Tabs validates the connection and begins calculating tax on new invoices.

Step 2: Map items to tax codes

You can map each item in Tabs to a tax code in your tax provider. This mapping tells the provider how to classify the product or service for tax purposes.

Item-to-tax-code mappings are configured in the Tabs app or by your Implementation Manager during onboarding.

Step 3: Configure tax exemptions

Some customers are exempt from sales tax. Tabs supports tax exemptions at two levels in the app:

• Customer-level: When a customer is marked as tax-exempt, Tabs skips tax calculation on all their invoices.
• Invoice-level: Individual invoices can be marked as tax-exempt for specific transactions.

Step 4: Verify tax on an invoice

After connecting your tax provider and mapping your items, verify that tax is calculated correctly by retrieving an invoice. Each line item includes a tax rate:

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"lineItems": [
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  {
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    "id": "li_001",
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    "name": "Monthly platform license",
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    "quantity": 1,
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    "subtotal": 500.00,
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    "discountTotal": 0,
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    "total": 500.00,
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    "salesTaxRate": "8.75",
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    "item": {
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      "id": "item_abc123",
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      "name": "SaaS Platform License"
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    }
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  }
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]

A non-zero salesTaxRate indicates that the tax provider calculated tax for that line item. If the rate is "0", verify that the item has a tax code mapping and that the customer’s address is in a taxable jurisdiction.

Tax calculation timing

Tabs calculates tax at two points:

• Estimate: When an invoice is generated or regenerated, Tabs requests a tax estimate from your provider. This is a non-binding calculation.
• Commit: When an invoice is sent, Tabs commits the tax transaction to your provider. This creates a permanent record for compliance.