10 Best Sales Tax Software for Ecommerce (2025) 🧾💰

Navigating sales tax compliance can feel like a full-time job for ecommerce businesses. With tax regulations and the complexities of multi-state operations, keeping up can quickly overwhelm even the most experienced sellers.

While many platforms calculate and collect sales tax at checkout, the responsibility of filing and paying those taxes still falls on you. The tricky part? Most tools specialize in either tax filing or accounting, but rarely both.

If you’re looking for accounting apps to streamline your sales tax management, Link My Books, integrated with either Xero or QuickBooks, is an excellent choice. Other tools we’ve included in this guide are better suited for calculating and filing tax returns.

To make things easier, we’ve divided this article into two categories:

1. Accounting for Sales Tax in Xero or QuickBooks – Perfect for managing bookkeeping but not for filing returns.
2. Software for Calculating and Filing Sales Tax Returns – Designed to handle compliance and filing but not bookkeeping.

10 Best Sales Tax Software for Ecommerce

• Xero with Link My Books
• QuickBooks with Link My Books
• Avalara
• TaxJar
• Vertex
• TurboTax
• H&R Block
• TaxAct
• TaxSlayer
• CreditKarma Tax

Link My Books - Best for accounting for e-commerce sales tax in Xero or QuickBooks

Getting your sales tax data right can save you a ton of stress when tax season rolls around. Link My Books organizes all your tax-related information into clear, comprehensive reports, making it easier to file returns with confidence. If you’re using Xero or QuickBooks, this integration ensures your records are accurate, audit-proof, and always ready when you need them.

Unlike one-size-fits-all accounting tools, Link My Books is an accounting software for ecommerce which means it was built specifically for ecommerce sellers. It understands the tricky stuff, like marketplace facilitator tax rules and multi-currency transactions, so you can rest easy knowing your financial data is spot-on and fully compliant.

1. Xero with Link My Books - Best for Overall E-commerce Operations

Xero is a cloud-based accounting software tailored for small to medium-sized businesses, offering features like invoicing and bank reconciliation. Its user-friendly, mobile-friendly interface provides real-time updates, making it a solid choice for e-commerce sellers and e-commerce accountants.

Xero integrates directly with several ecommerce platforms, including:

• Shopify
• WooCommerce
• BigCommerce
• Amazon
• eBay
• Etsy

However, these direct integrations have limitations that may not fully meet the complex needs of e-commerce businesses:

• Sales Tax Management: They don’t automatically calculate or apply sales tax based on your location, which can lead to compliance challenges.
• Invoice Generation: Xero doesn't create separate invoices for each sales transaction, complicating order tracking and customer management.
• Inventory and Cost Tracking: They don’t manage inventory or track the cost of goods sold, making it difficult to maintain accurate stock levels and profit margins.
• Multi-Store Management: You can't connect multiple stores to a single Xero account, limiting scalability for businesses operating multiple storefronts.
• Multi-Currency Support: The integrations don't support stores and Xero accounts that use different currencies, posing challenges for international operations.
• Payment Details on Invoices: Invoices generated through these integrations won't show individual customer payment details, affecting transparency and record-keeping.

Relying solely on Xero's direct integration may not be the most effective approach for e-commerce accounting.

To ensure your taxes are always in order and to enhance your accounting processes, consider integrating Link My Books with Xero.

Features

Integrating Link My Books with Xero offers a complete accounting solution for ecommerce businesses, addressing the unique challenges of multi-channel sales and financial management. 

Here's what it delivers:

Automated Transaction Syncing

Link My Books automatically imports and categorizes sales data from platforms like Shopify, Amazon, and WooCommerce. Every transaction, refund, and fee is accurately recorded, eliminating manual data entry and significantly reducing the risk of errors.

Detailed Financial Reporting

Gain access to in-depth reports that showcase your sales, expenses, and profit margins across all channels. These comprehensive insights enable you to make data-driven decisions and uncover new growth opportunities.

Accurate Sales Tax Calculations

Link My Books simplifies complex sales tax scenarios by automatically calculating taxes like VAT and GST based on transaction data. This ensures compliance across various jurisdictions, making tax season hassle-free and reducing the risk of costly errors.

Cost of Goods Sold (COGS) Tracking

The COGS tracking feature automates the allocation of sold inventory costs. When products are sold, the system moves their monetary value from the inventory account on your balance sheet to the COGS account on your profit and loss report. This ensures your financial data is always accurate, helping you track profit margins and make smarter inventory decisions without needing additional tools.

Multi-Currency Support

For businesses with international sales, Link My Books offers seamless multi-currency capabilities. Transactions are automatically converted and recorded accurately, ensuring compliance and clarity in your global financial records.

Scalability for Growing Businesses

Designed to handle high transaction volumes, Link My Books can manage multiple ecommerce stores within a single Xero account. This makes it an excellent choice for businesses looking to scale their operations without adding complexity to their accounting workflows.

Tax and Audit Readiness

With organized, audit-ready records, Link My Books simplifies tax filings and compliance checks. The platform automatically reconciles data and eliminates discrepancies, ensuring your financials are accurate and ready for review at any time. 

What other ecommerce sellers say about Link My Books

“Trying to reconcile eBay sales in Xero is near-impossible without hours of back-and-forth clicking and confusing VAT. Thankfully someone recommended Link My Books last year so I researched along with some comparable tools and found it to be the most cost-effective and purpose-built for my needs. I've managed to save a lot of time and the support team have been very friendly and always responded promptly.” - Kevin L. - Managing Director

You can try Link My Books for free for 14 days. You don’t need a credit card and it takes 15 min to set up. 

2. QuickBooks with Link My Books - Best for Scalability

QuickBooks Online is a widely-used accounting platform tailored for small business owners, offering an intuitive interface and a comprehensive suite of accounting tools that simplify financial management.

While QuickBooks Online integrates directly with several e-commerce platforms, including Shopify, Amazon, and eBay, users have reported certain limitations with these integrations:

• Data Transfer Issues: Some users have experienced data loss or inaccuracies during the transfer process, leading to potential discrepancies in financial records.
• Inventory Management Limitations: The direct integration may not effectively map products and inventory between platforms, necessitating manual adjustments to maintain accurate stock levels.
• Limited Integration Options: QuickBooks Online may not offer direct compatibility with certain popular marketplaces and innovative payment solutions, which can pose challenges for businesses aiming to incorporate these services into their workflow.

To address these challenges, integrating Link My Books with QuickBooks Online offers a more robust solution for e-commerce accounting:

• Reliable Data Synchronization: Link My Books ensures accurate and complete data transfer from various e-commerce platforms to QuickBooks Online, minimizing errors and maintaining the integrity of your financial information.
• Enhanced Inventory Tracking: By effectively mapping products and inventory, Link My Books facilitates precise inventory management, reducing the need for manual interventions.
• Comprehensive Multi-Channel Support: Link My Books seamlessly integrates with multiple e-commerce platforms, providing a unified accounting solution that adapts to your business's evolving needs.

You can explore the benefits of Link My Books with a 14-day free trial, no credit card required.

Best Software for Calculating and Filing Sales Tax Returns in E-commerce

When managing sales tax for your ecommerce business, it’s important to differentiate between filing and calculating sales tax and accounting for sales tax. Apps designed for calculating and filing sales tax focus on ensuring compliance by automatically determining accurate tax rates, collecting sales tax, and filing returns across various jurisdictions. However, these tools don’t typically handle bookkeeping tasks or integrate deeply with accounting platforms like software for bookkeepers.

If your priority is filing sales tax returns accurately and staying compliant, this section will highlight the best apps for the job.

Why the Distinction Matters

Purpose

• Accounting for Sales Tax: Apps like Link My Books integrate sales tax data directly into accounting platforms, streamlining bookkeeping processes. These apps are designed to organize and reconcile your financial data, but they don’t file taxes.
• Calculating and Filing Sales Tax: These apps automate compliance tasks, such as calculating tax for each sale and filing returns across multiple states or countries.

Suitability

• Filing Apps: Best for businesses selling in multiple states or countries that need help managing and filing tax returns.
• Accounting Apps: Ideal for syncing sales data with accounting software, ensuring accurate financial records for bookkeeping purposes.

Functionality Gap

• Filing Apps: Generally lack seamless integration with accounting platforms, creating a gap between tax filing and financial recordkeeping.
• Accounting Apps: Focus on integrating sales data into accounting software but don’t offer tax filing by jurisdiction.

1. Avalara - Best for Enterprise-Level Businesses With Complex Tax Compliance Needs

Avalara is a cloud-based solution providing end-to-end sales tax and compliance services, including real-time tax rate calculations, automatic return filing, and seamless integration with various ecommerce platforms and accounting systems.

Avalara’s AvaTax engine ensures real-time tax calculations during checkout, while its compliance document management feature stores exemption certificates and other critical documents.

The platform’s API integration capabilities make it customizable for enterprise-grade systems, allowing businesses to tailor Avalara to their specific workflows. It’s a trusted solution for companies with significant sales volume, where accuracy and scalability are paramount.

Ideal for:

• Enterprises operating across multiple countries
• Businesses with high transaction volumes require robust automatio

Features

‍

• Comprehensive Tax Compliance: Covers U.S. sales tax, international VAT, and GST regulations.
• Document Management: Tracks and stores compliance documents like exemption certificates.
• Real-time Tax Rate Calculations: Avalara provides real-time tax rate calculations for accurate tax compliance.
• Automatic Return Filing: Avalara automates the return filing process, reducing manual errors.
• Seamless Integration: Avalara integrates seamlessly with various ecommerce platforms and accounting systems.

2. TaxJar - Best for Small- to Medium-Sized Ecommerce Businesses Needing Automated Sales Tax Calculations and Filing

TaxJar is a modern cloud platform that automates sales tax compliance across all sales channels, offering features such as sales tax calculation, reporting, filing, and handling sales tax for multiple states and tax jurisdictions.

TaxJar also integrates seamlessly with platforms like Shopify, Amazon and Walmart, making it a versatile solution for multichannel sellers. Its advanced analytics allow you to dive deeper into tax trends and liabilities, offering insights to optimize your operations.

Ideal for:

• U.S.-based sellers managing multi-state taxes
• Businesses growing into new regions and dealing with nexus compliance

Features

• Sales Tax Calculation, Reporting, And Filing Features: TaxJar automates sales tax compliance across all sales channels.
• Handling Sales Tax for Multiple States: TaxJar can handle sales tax for multiple states and tax jurisdictions, making it ideal for businesses selling in multiple locations.
• Real-Time Tax Calculations: Automatically calculates sales tax based on the customer’s location at checkout.
• AutoFile Services: Files sales tax returns on your behalf for multiple states or countries.
• Economic Nexus Tracking: Tracks your sales volume to identify where you’re required to collect and remit taxes.
• Integration With Popular Ecommerce Platforms: TaxJar integrates with popular e-commerce platforms for streamlined tax compliance.

3. Vertex - Best for Large Businesses Requiring Advanced Tax Management Solutions Integrated With ERP Systems

Vertex is a comprehensive tax technology solution offering tax compliance services that integrate and simplify sales tax compliance, enabling businesses to grow locally or globally with features like tax rate calculations, tax return preparation, and compliance research tools.

Features

• Tax Rate Calculations: Vertex offers tax rate calculations for accurate tax compliance.
• Tax Return Preparation: Vertex provides tax return preparation services to ensure accurate and timely filing.
• Compliance Research Tools: Vertex offers compliance research tools to help businesses stay up-to-date with tax laws and regulations.

4. TurboTax - Best for Individuals and Small Business Owners Looking for Easy-to-Use Tax Filing Software 

TurboTax, developed by Intuit, is a leading tax preparation software that offers a user-friendly interface and personalized experience, guiding users step-by-step through their tax filing process.

Features

• Comprehensive Guidance: TurboTax provides guidance for all tax situations and guarantees 100% accuracy.
• Audit Support: TurboTax offers audit support from a tax professional.
• Import Financial Data: TurboTax allows users to import financial data from a variety of sources.

5. H&R Block - Best for Personal Tax Filing With the Option for In-Person Assistance

H&R Block is a comprehensive tax service provider that offers both online and in-person tax filing options, ensuring accurate tax returns and providing robust customer support.

Features

• Data Import: H&R Block allows users to import tax returns from other tax prep companies.
• Tax Pro Review: H&R Block offers a service where a tax professional reviews, signs, and e-files your tax return.
• Refund Advance loan: H&R Block provides a no-interest loan that you can get in as little as two hours.
• MyBlock App: Allows you to store tax documents, chat with a tax pro, and track your refund. 

6. TaxAct - Best for Cost-Conscious Individuals and Small Businesses Seeking a Budget-Friendly Solution

TaxAct is a reliable tax software that provides a range of tax filing options, from simple to complex tax situations, with step-by-step guidance and maximum refund guarantee.

Features

• Price Lock Guarantee: TaxAct offers a price lock guarantee, meaning the price when you start your return is the price when you file.
• Accuracy Guarantee: TaxAct guarantees the accuracy of the tax calculations it performs.
• Step-By-Step Guidance: TaxAct provides guidance throughout the tax filing process.

7. TaxSlayer - Best for Freelancers, Self-Employed Individuals, and Small Businesses Needing Affordable Tax Preparation Tools

TaxSlayer is a cost-effective tax filing solution that offers a range of products to suit different tax situations, providing fast, easy, and accurate tax filing services with a maximum refund guarantee.

Features

• Affordable Pricing: TaxSlayer offers competitive pricing for its tax filing services.
• Military Discount: TaxSlayer offers free federal tax return filing for active duty military.
• Support From Tax Professionals: TaxSlayer provides access to tax professionals for help and advice.

8. Credit Karma Tax - Best for Individuals Looking for a Free and Straightforward Tax Filing Service

Credit Karma Tax, developed by Intuit, offers a free tax filing service that allows users to prepare and file their federal and state tax returns at no cost. In partnership with TurboTax, Credit Karma provides an integrated platform where users can file their taxes directly through the Credit Karma app or website. 

This service is designed to be user-friendly, guiding individuals through the tax preparation process with step-by-step instructions. It supports various tax situations, ensuring that users can accurately report their income, deductions, and credits.

Features

• Free Federal and State Tax Return Filing: Credit Karma Tax allows users to file both federal and state tax returns for free, making it a cost-effective choice for many taxpayers.
• Clear And Easy-To-Navigate Interface: The software offers a user-friendly experience with a clear and easy-to-navigate interface, simplifying the tax filing process.
• Does not Offer Expert Help: While Credit Karma Tax provides a comprehensive tax filing service, it does not offer expert help. This makes it best suited for individuals who are confident in completing their tax return independently.

How to choose the best ecommerce solution for sales tax 

To make an informed decision when choosing sales tax software, consider the following criteria:

• Ease of Use: Opt for software with an intuitive interface and user-friendly design.
• Integration: Ensure compatibility with your existing ecommerce and accounting platforms.
• Accuracy: Look for software that maintains accurate tax calculations to avoid penalties and overpayments.
• Compliance: Choose software that stays up to date with the latest tax laws and regulations.
• Reporting: Select software that offers comprehensive reporting features to track and analyze your tax data effectively.
• Customer Support: Opt for a software provider that offers robust customer support to help resolve any issues that may arise.

How do They Compare

Here’s a table so you can compare them at a glance:

Why Sellers Choose Link My Books For Ecommerce Accounting?

In addition to sales tax software, integrating ecommerce accounting software can further automate your processes. 

Link My Books is a valuable accounting automation tool designed specifically for ecommerce sellers. Its features include automated sales data import, cost of goods sold (COGS) calculation, and VAT calculation. 

By seamlessly integrating with popular ecommerce platforms, such as Amazon, eBay, and Shopify, Link My Books streamlines your ecommerce accounting workflows and ensures accurate financial reporting.

FAQ

What’s the best software for sales tax compliance?

The best software for sales tax compliance depends on the size and complexity of your business:

• Avalara: Ideal for enterprise-level businesses managing multi-state or international tax compliance.
• TaxJar: Best for small- to medium-sized ecommerce businesses needing automated sales tax calculation and filing.
• Vertex: Suited for large businesses requiring advanced tax management integrated with ERP systems.
  Each of these tools automates tax calculations, ensures compliance across jurisdictions, and simplifies the filing process.

Is QuickBooks or Xero best for ecommerce accounting?

Both QuickBooks and Xero are excellent for ecommerce accounting, but the best fit depends on your business needs:

• QuickBooks: Offers robust reporting, scalability for larger operations, and advanced features like inventory tracking. Best for businesses looking for comprehensive tools to manage finances.
• Xero: Known for its clean interface, real-time updates, and multi-currency support, making it great for small- to medium-sized ecommerce businesses.

When paired with Link My Books, both platforms excel in automating ecommerce data reconciliation, improving efficiency, and ensuring financial accuracy.

What are the risks of not using dedicated sales tax software for online retailers?

Not using dedicated sales tax software can lead to:

• Non-Compliance: Miscalculations or missed filings can result in penalties, audits, or legal issues.
• Manual Errors: Handling sales tax manually increases the risk of mistakes in calculations or reporting.
• Inefficiency: Time spent on tax calculations and filings could be better allocated to growing your business.
• Lost Trust: Inaccurate tax reporting can damage your reputation with customers and tax authorities.
  Dedicated software ensures compliance, reduces errors, and saves time, making it an essential tool for online retailers.

What is the best sales tax automation accounting software?

The best sales tax automation accounting software combines tax compliance with seamless accounting integration:

• Link My Books: Syncs ecommerce sales data with QuickBooks or Xero, automating tax calculations and categorization for error-free records.
• Avalara: Excels in automating multi-jurisdiction compliance for larger businesses.
• TaxJar: Offers affordable and user-friendly tools for small- to medium-sized online sellers.

For businesses needing both automation and scalability, these tools provide reliable solutions for managing sales tax alongside broader financial needs.

Which Ecommerce Sales Tax Software is Best for You?

The best ecommerce sales tax software depends on your business needs. TaxJar is ideal for small- to medium-sized businesses looking for affordable, automated compliance. Avalara and Vertex offer advanced solutions for enterprise-level businesses with complex tax needs, while Link My Books integrates seamlessly with QuickBooks and Xero to simplify accounting and sales tax reconciliation. 

For budget-friendly options, Credit Karma Tax provides free filing for smaller operations. Choosing the right tool ensures compliance, saves time, and helps you focus on growth.

Automate Your Ecommerce Accounting With Link My Books

Link My Books, makes it as simple as possible to get set up. Behind the scenes, a multitude of automated processes are simplified for you into a couple of clicks and linking your accounts from the relevant e-commerce platforms and QuickBooks or Xero!

And it only takes 15 minutes to set up. 

Here’s what to do:

Getting Started with Link My Books:

1. Sign up for an account on the Link My Books website.
2. Connect your ecommerce platforms and accounting software.
3. Configure the settings according to your specific needs and preferences.
4. Link My Books will automatically import your sales data and generate accurate accounting entries.

Take the hassle out of managing sales tax and reconciling transactions. With Link My Books, you can automate your accounting, ensure tax compliance, and save hours every month.

Start your 14-day free trial today - no credit card required!