Canopy
Cloud practice management for accounting firms with client management, document management, workflow, time and billing modules.
Avalara
Website: www.avalara.com
Avalara at a glance
- Best for
- Clients with multi-state or cross-border indirect tax
- Pricing model
- Subscription by transaction volume and returns filed
- Deployment
- Cloud, with ERP and e-commerce connectors
- Regions
- Global, with deepest US sales tax coverage
- Key integrations
- NetSuite, QuickBooks, Shopify, Sage Intacct
Last reviewed . Pricing and features change frequently — confirm current details with the vendor.
Avalara is a tax automation platform that calculates, collects, and remits sales tax, VAT, and other transaction taxes across thousands of jurisdictions, automating indirect tax compliance for businesses with obligations in multiple states or countries.
How accounting firms use it
The driver is almost always nexus exposure. Since economic nexus rules took effect across US states, clients selling online can trigger registration and filing obligations in states where they have no presence, purely on revenue or transaction counts. Firms use the platform to monitor where a client is approaching thresholds and to handle the filings once registered.
Rate maintenance is the other recurring value. Jurisdictions change rates and rules continuously, and sales tax is assessed at a level of granularity — state, county, city, special district — that makes manual maintenance impractical past a handful of registrations.
Key features
The calculation engine determines tax at transaction time based on ship-to address, product taxability, and customer status, integrated into the client’s ERP, accounting, or e-commerce system so the correct rate applies at the point of sale.
Exemption certificate management collects, validates, and stores certificates, flagging expiry — a common audit weakness where clients hold certificates that have lapsed or were never obtained.
Returns preparation and filing covers registration, preparation, submission, and remittance, available as a service alongside the calculation engine.
Who it’s best for
Firms advising e-commerce sellers, multi-state businesses, and companies with cross-border sales, where indirect tax obligations span enough jurisdictions to make manual compliance unreliable.
Firms handling only income tax compliance have no use for it. Clients registered in a small number of states often find manual filing cheaper. Vertex is the main enterprise alternative, and Sovos is generally stronger where international e-invoicing mandates are the concern.
Avalara FAQ
- What is economic nexus and why does it matter?
- Following the 2018 Wayfair decision, US states can require sales tax collection from sellers with no physical presence once revenue or transaction thresholds are crossed. Thresholds vary by state, so a growing e-commerce client can acquire filing obligations in a dozen states without any deliberate expansion. Tracking that exposure across jurisdictions is the primary reason firms adopt automated indirect tax software.
- Does Avalara file returns as well as calculate tax?
- Yes. Returns preparation and filing is a separate service from the calculation engine, covering registration, filing, and remittance across registered jurisdictions. Firms often use calculation alone and retain filing themselves, or hand both over depending on how the client engagement is structured.
- How does it integrate with accounting and e-commerce systems?
- Through pre-built connectors for NetSuite, QuickBooks, Sage Intacct, Shopify, WooCommerce, and many others, calculating tax in real time at the point of transaction rather than as a period-end adjustment. An API is available where a client's stack has no pre-built connector.
- What are the main alternatives?
- Vertex is the closest competitor and is often preferred by larger enterprises with complex ERP environments. Sovos competes strongly on regulatory reporting and e-invoicing mandates outside the US. For clients with a small number of state registrations, manual filing or a lighter tool is frequently more economical.
Avalara Alternatives
Other tax tools for accounting firms, ordered by how much of Avalara's functionality they cover.
ATX Professional
Forms-based tax preparation software from Wolters Kluwer for small US firms, with a large form library and straightforward e-filing.
CCH Axcess Tax
Wolters Kluwer's cloud-based tax preparation platform for accounting firms with real-time collaboration and analytics dashboards.
CCH ProSystem fx Tax
Comprehensive tax preparation and compliance solution helping accounting firms efficiently prepare and file accurate returns.
CrossLink Professional Tax
Professional tax software with high-speed e-filing, bank product integrations, and multi-office support for tax businesses.