The US has over 12,000 state and local tax jurisdictions just waiting to trip up unsuspecting online sellers. Trying to stay compliant in each of them requires you to be switched on 24/7 without any time to focus on your actual business.
This is where sales tax software comes in handy.
These tools do way more than just crunch numbers. They help you stay compliant in multiple jurisdictions at the same time while navigating tax rate calculations, nexus tracking, compliance management, and filing.
Here, we’ll cover the top sales tax software for ecommerce brands, including their pricing and core features.
Why You Might Want to Invest in a Sales Tax Software
Taxes are a boring but necessary part of business. Using software to manage and file your sales tax can take some of the stress out of it by reducing potential human errors and avoiding costly penalties.
Here’s why it’s a smart move for ecommerce brands:
- Tax rate calculation. Sales tax rates vary widely across regions, and manually keeping up with these rates is a pain. A tax engine automatically calculates the right rate for each transaction based on your customer’s location.
- Nexus tracking. Sales tax nexus (where you have a tax obligation) changes as your business grows. Sales tax software tracks nexus for you, so you’ll know when you hit new thresholds and need to start collecting in additional states or countries.
- Compliance. Staying compliant across multiple jurisdictions is crucial—and complex. Sales tax software updates in real-time with tax law changes.
- Remittance and filing. Filing sales tax returns and remitting taxes to various jurisdictions is time-consuming. The right software takes care of this for you.
Sales Tax Engine vs Sales Tax Filing Tool - What’s the Difference?
Let’s quickly break down the difference between a sales tax engine and a sales tax filing tool. It’s easy to confuse the two, but there’s a simple way to tell the difference.
A sales tax engine:
- Calculates precise tax rates in real-time
- Tracks your nexus across different states and jurisdictions
- Integrates directly with your shopping cart or sales platform
- Makes sure you're charging the exact right amount of tax at the moment of sale
A sales tax filing tool:
- Prepares and files your sales tax returns
- Tracks filing deadlines
- Submits payments to multiple state jurisdictions
- Generates comprehensive tax reports
The key difference is a tax engine is all about the moment of sale, while a filing tool follows up after the sale.
The most powerful solutions often combine both features. They handle the sales tax at the point of sale and automatically file your tax returns in the right tax jurisdictions.
Numeral
Numeral was designed specifically for ecommerce businesses, so we understand the unique challenges you face. Our core features all aim to make tax management less of a nightmare.
With real-time tax calculations, Numeral lets you calculate accurate taxes on every transaction, taking into account location, product category, and customer type. This accuracy is a non-negotiable for brands selling across multiple states or countries, where the tax rules and rates can change dramatically.
Numeral also automatically files your taxes and remittances. Rather than manually gathering all the data and filing returns with each tax authority—which, let’s face it, is a massive time-suck—it handles it all automatically. One of the biggest benefits of this is there’s less risk of costly mistakes.
One of our standout offerings is the proprietary tax engine. This is a big bonus for Shopify sellers in particular as you can seamlessly integrate the two platforms together to sync your data and calculate your exact tax obligations in real-time.
Integrations: Etsy, eBay, Amazon, Shopify, Stripe
How pricing works
Our pricing is refreshingly transparent. You pay a flat rate per state filing ($75) and per state registration ($150).
How to get started
To get a taste of how Numeral can work for you, start with a demo or explore our features with a free tax analysys. When you’re ready, simply create an account and connect it to your online store.
Avalara
Avalara is also a popular choice for ecommerce brands, although it wasn’t designed specifically for ecommerce brands—it’s more of a mid-market offering. Like Numeral, it automates tax calculations in real-time. For every transaction, it automatically calculates the right amount of tax based on product type, where the customer is based, and other factors that impact tax in different states or countries.
It also handles filings and remittances on autopilot so you don’t have to worry about hiring an accountant or remembering to file different tax returns at different times. Plus, it sends your tax payments to the appropriate tax authorities when they’re due.
Integrations: Woo, Shopify, Stripe, Amazon, BigCommerce, Salesforce, Oracle Netsuite, and others.
How pricing works
Avalara isn’t the cheapest option. It uses a quote-based pricing model, so costs can vary wildly. The cost to register in a new state is $349 per location, so it’s a big leap from Numeral’s pricing.
How to get started
To get started, you need to fill out a form with basic information about your business. Then someone will be in touch to discuss which features are most appropriate for you.
TaxJar
TaxJar was also built with ecommerce brands in mind. It’s a cloud-based platform that automates the entire sales tax lifecycle across any and all of your sales channels. This includes automated calculations on each transaction, nexus tracking, and automated reporting and filing.
One of its biggest strengths is the way it pulls data directly from your sales channels to calculate accurate sales tax. It also updates those calculations whenever rates change. At the end of each month, you get a Sales Tax Report that lets you see exactly what you owe across jurisdictions. The AutoFile feature is pretty handy too. Much like Numeral, TaxJar automatically files returns and submits payments to the right authorities.
Integrations: Shopify, Amazon, BigCommerce, Magento, Quickbooks, Squarespace, and others.
How pricing works
TaxJar offers a tiered subscription model with monthly and annual plans. There’s also a 30-day free trial so you can test out the features before committing.
How to get started
It’s a good idea to try out the generous 30-day trial to get a feel for the features. When you’ve done that, you’ll have a better understanding of which pricing tier is right for your business. You can automatically upgrade once the trial is over.
Sovos
Sovos is an umbrella company focused on regulatory compliance across a number of sectors, including manufacturing and ecommerce. Its suite of products includes sales tax software called Taxify that determines how much tax is due in relevant states (and internationally). It uses the latest rules and regulations to make sure you’re paying the right rate of sales tax and comes with detailed reporting capabilities.
You can get detailed, customized reports that show you exactly how much tax you owe across states. Like the other tools here, you can also automate tax filings and integrate with most major ecommerce platforms and ERP systems.
Integrations: Salesforce, SAP, Oracle, Magento
How pricing works
Sovos uses a customized pricing model, so costs vary depending on which features you need and how complex your sales tax requirements are. You can get a demo to see how it works before investing.
How to get started
Start by getting in touch with a Sovos expert who can help you put together the right package for your needs.
Stripe Tax
Stripe’s Tax tool works best if you’re already using Stripe for payments. As well as automatically calculating accurate tax, it also integrates seamlessly within the Stripe ecosystem (obviously). There’s no complex setup or third-party software required.
Stripe Tax automates your tax reports, giving you detailed insight into how much tax has been collected across different regions. However, it’s worth noting that, while Stripe Tax offers reporting features, it doesn’t file taxes for you, so you’ll still need a way to handle the filing process itself.
Integrations: any tool that integrates with Stripe.
How pricing works
Stripe Tax charges a small percentage of each transaction. This scales as you grow, but it doesn’t require any upfront commitment. While this makes it accessible for smaller brands, it can quickly add up for higher-volume businesses.
How to get started
Stripe Tax is an API you can integrate with an existing Stripe account. To get started, you’ll need to configure your tax settings in the dashboard. Once that’s done, you can apply Stripe Tax to checkout and use it for subscriptions and invoices.
TaxCloud
TaxCloud is a budget-friendly option with an automated tax calculation feature and an automated filing system. It automatically calculates tax on each transaction across thousands of jurisdictions as well as handles tax returns directly with each individual state’s tax authority. Similarly to the other tools here, it integrates with popular ecommerce platforms so you can link it with your storefront for instant tax calculations.
Integrations: BigCommerce, Shopify, Odoo, Oracle Netsuite, WooCommerce, AdobeCommerce, and others.
How pricing works
One of the most appealing things about TaxCloud is its pricing structure. The core software is free for merchants to use in certain states, with additional paid features and state filing options. If you need to file tax reports in multiple states, choose the “starter” plan, which is $199 a year. There’s also a free 30-day trial so you can check out the features before you commit.
How to get started
Definitely give the 30-day trial a go to get acquainted with TaxCloud’s features. At this point, you’ll be asked to create an account and provide information about your business. Once you’ve done that, you can confirm your login details and go.
Zamp
Zamp is a newer player in the sales tax software space, but it’s also geared towards ecommerce brands. One of its strengths is its straightforward approach to tax calculations. It uses real-time tax data to apply the correct rates for each transaction based on location and product type and it also provides automated reporting. This lets you see all your tax data and liabilities from different jurisdictions in one place.
Note that Zamp doesn’t yet offer automatic filing, so you’ll need to handle this yourself or submit returns through another system.
Integrations: Shopify, Stripe, BigCommerce, Amazon, Quickbook, and others.
How pricing works
Zamp runs on a subscription model that scales depending on how complex your sales tax needs are. Its website claims its most popular subscription tier is $999 a month and covers 21 states, so it may not be the cheapest option on the market.
How to get started
Zamp invites customers to get in touch to share a bit about their brand so the company can find the right subscription tier.
Kintsugi
Kintsugi is a cloud-based sales tax software for all types of businesses—not just ecommerce. It has automated nexus tracking which monitors sales volumes and transactions across states, identifying potential nexus triggers before they become compliance headaches.
And, like the majority of other tools here, it calculates the appropriate sales tax in real-time and files your tax returns for you. Through its integrations with most ecommerce platforms and marketplaces, Kintsugi tracks sales across channels and brings together your tax data from all of them in one place.
Integrations: Amazon, Shopify, Stripe, BigCommerce, eBay, and others.
How pricing works
Pricing depends on your sales volume and the complexity of your sales tax needs. Companies just getting started can try out the free plan, but this doesn’t include automatic filing. To access this feature, you need to be on the “growth” plan, which starts at $100 for companies filing in fewer than 10 states.
How to get started
Try out a demo to see if it's the right platform for you. If you decide it is, you can create an account, sync your billing data, and register with the states you need to.
Vertex
Vertex isn’t playing small with its Tax Compliance product. In fact, it’s mostly aimed at enterprise-level brands, but this does mean it comes with a powerful set of tools. Its continuously updated tax content database covers over 11,000 state and local jurisdictions, including real-time rate updates, exemption certificates, and compliance rules.
Its AI-powered engine automatically calculates precise tax rates based on product taxonomy, shipping destinations, and unique product taxability rules, plus it generates highly detailed reports, audit trails, and transaction logs. Vertex is another one that automatically files your returns to the right jurisdictions.
Its main offering is cloud-based, but larger companies can also sign up for on-premise implementations or hybrid models.
Integrations: BigCommerce, Adobe Commerce, Oracle, SAP, and others.
How pricing works
Pricing is enterprise-level and customized for each individual brand depending on how many transactions you make and how many tax jurisdictions you need to cover.
How to get started
Get in touch with the sales team to discuss your business’s needs. They’ll be able to help you decide which building blocks you need for your business and will help you create a customized platform.
Lovat
Lovat uses sophisticated algorithms to monitor your sales volume and automatically flags potential nexus triggers before they become a problem. And, like all the other tools here, it automatically delivers incredibly precise tax calculations, taking into account changing state and local tax rates and the unique characteristics of each transaction.
It also automatically files tax and remittance and submits the relevant payments for you.
The one thing that sets Lovat apart is its AI-powered predictive tax compliance feature, which goes beyond just simply calculating how much tax is owed in each jurisdiction. It uses machine learning to analyze your brand’s historical sales data, transaction patterns, and tax compliance history to proactively recommend personalized ways to stay compliant.
Integrations: Magento, eBay, WooCommerce, Shopify, Amazon, PayPal.
How pricing works
Lovat has a free tier for brands that need nexus tracking, but you don’t get a ton of features. To unlock sales tax calculations and reporting, you need to be on the Start-Up tier at an absolute minimum. Prices start at $35 a month and increase from there depending on how many transactions take place each month.
How to get started
You can try out all subscription levels for free. Get a feel for the features you might need for your business—you’ll automatically be upgraded when the trial ends.
Final Thoughts
Hopefully, you now have a better understanding of how sales tax tools can help you stay compliant and take the stress out of managing sales tax in multiple jurisdictions.
Whether you’re just beginning or scaling up, each platform on this list can the heavy lifting off your plate—from precise tax rate calculations and nexus tracking to automatic filing and compliance management.
Just remember to check the tool you go for manages sales tax and files your taxes for you if you need it to do both.
With the right software, you can reduce any potentially costly mistakes, keep pace with changing tax laws, and focus on what really matters: growing your business.
