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International Mapping Guidelines

Overview

The purpose of this guideline is to inform AFC software clients how to map international transactions.

AFC currently supports multiple international jurisdictions. Section 2 of this guideline contains the different Tax Types (section 2.1), different Transaction/Service pairs (section 2.2), and a link to supported jurisdictions (section 2.3) used internationally.  Starting in Section 3 of this guideline, we provide directions for mapping of international jurisdictions that use alternative methodologies in AvaTax for Communications because of their unique taxing regime.  The required Tax Types and Transaction/Service pairs are listed within each section.

International Mapping

Tax Types

The following Tax Types are used for international taxation.

Tax Type

Name

Description

5

Excise Tax

Excise taxes are imposed at the manufacturer and/or retail level and are virtually indistinguishable from a sales tax to the consumer. However, many excise taxes are considered part of the sale or gross receipts and are therefore taxes by sales and/or gross receipts taxes.

8

License Tax

Tax based upon the granting of a license to perform a service to the community. In many cases, this tax can be passed on to consumers.

14

Statutory Gross Receipts

Tax based upon the gross receipts of one or more transaction and service type combinations.

65

VAT

International based tax on the final consumption of certain goods and services.

66

Goods and Service Tax (GST)

Goods and service tax based on consumption.

298

Universal Service Fee

The purpose of the fund depends upon the state; however, these are typically used for items such as funding schools or subsidizing the cost of telecommunications users in remote locations.

393

Tasa de Control

A telecommunications regulatory fee applied in Argentina.

394

Radio Rights Fee

A fee applied per station and per frequency to providers of Mobile Telecommunications.

409

VAT (Reduced Rate)

Similar to Tax Type 65 (VAT) but applied at a reduced rate.

464

VAT (Wireless)

Similar to Tax Type 65 (VAT) but only applied to wireless services.

465

VAT (Communications)

Similar to Tax Type 65 (VAT) but only applied to communications services.

527

National Sales Tax

Similar to Tax Type 1 (Sales Tax) but only applied to international jurisdictions levying sales tax.

550

Telecommunications Levy

Telecommunications tax to be used for international jurisdictions.

551

Telecommunications Levy (Internet)

Telecommunications tax on internet access to be used for international jurisdictions.

556

Turnover Tax

An indirect tax on goods and services.

558

Turnover Tax (Reduced Rate)

Similar to Turnover Tax (Tax Type 556) but applied at a reduced rate.

559

National Sales Tax (Wholesale)

Similar to National Sales Tax (Tax Type 527) but applied only to wholesale transactions.

 564 Broadcast Tax A tax on the provision of digital content.

Valid Transaction/Service Pairs

Only the following Transaction/Service pairs should be used for international service mapping.

Transaction Type

Service Type

Name

Description

14

15

International/Product

Supply of goods for consideration within countries other than Canada, USA, and US territories.

14 636 International/Remotely Accessed Software A service that provides access and usage of software that remains in the possession of the seller and is remotely accessed by a customer. Only to be used in international jurisdictions.
 14 676 International/Digital Downloaded Audio The purchase of audio via the internet. The purchaser retains possession of the audio. Only to be used in international jurisdictions.
 14 677 International/Digital Streaming Audio The purchase of audio via the internet. The purchaser does not retain possession of the audio. Only to be used in international jurisdictions.
 14 678 International/Digital Downloaded Video The purchase of video via the internet. The purchaser retains possession of the video. Only to be used in international jurisdictions.
 14 679 International/Digital Streaming Video The purchase of video via the internet. The purchaser does not retain possession of the video. Only to be used in international jurisdictions.
 14 680 International/Digital Downloaded Video Game The purchase of a video game via the internet. The purchaser retains possession of the video game. Only to be used in international jurisdictions.
 14 681 International/Digital Streaming Video Game The purchase of ­­­­­­­­­­a video game via the internet. The purchaser does not retain possession of the video game. Only to be used in international jurisdictions.
 14 682 International/Downloaded Software Charges for software transferable to the computer by electronic means. Customer retains possession of the software. Only to be used in international jurisdictions.

15

7

Telephony/Service

All telephone service in countries other than the USA, Canada, Puerto Rico and the Virgin Islands.

15

624

Telephony/Wireless Service

All wireless telephone service in countries other than the USA, Canada, Puerto Rico and the Virgin Islands.

15

627

Telephony/Internet Access

All Internet Access in countries other than Canada, USA and US territories.

15

629

Telephony/Messaging Services

All Messaging Services in countries other than Canada, USA and US territories.

International Jurisdiction List

Reference the Supported country codes and Supported states, territories, and provinces for a complete list of international jurisdictions and ISO codes.

Canada

As currently configured, the AFC tax engine does not limit Canada to the International specific Tax Types and Transaction/Service pairs.

Valid Transaction/Service pairs utilized in Canada are the same as those used for US mapping, encompassing telecom products and services as listed in the TM_00115_AFC Transaction and Service Types document.

Do not attempt to use International Transaction Types (14) or Telephony Transaction Types (15) in Canada.

Tax Types returned in Canada are generally Goods and Services Tax and Provincial Sales Taxes.

The following Tax Types will return in Canada:

Tax

Tax Type

Tax Level

Description

E-911

10

1 (State)

Provides funding for the emergency 911 systems.

Goods and Service Tax (GST)

66

0 (Federal)

Goods and service tax based on consumption.

Harmonized Sales Tax (HST)

67

1 (State)

Provincial sales tax applied in specific Canadian provinces. Rate is a combination of the provincial sales tax and the national GST.

Provincial Sales Tax (PST)

68

1 (State)

Sales tax applied at the provincial level. 

Quebec Sales Tax (QST)

69

1 (State)

Specific sales tax applied only in the province of Quebec, Canada.

National Contribution Regime (NCR)

70

0 (Federal)

National Canadian tax on telecom for the provisioning of universal service throughout Canada. Similar to the Federal USF.

Provincial Sales Tax (TOLL) 181 1 (State) Sales tax applied in various Canadian provinces.  This tax type applies to Toll Services only.

E-911 Service Fee (NL 911 Bureau)

435

1 (State)

Newfoundland and Labrador’s Provincial E911 Fee.

Canadian Sourcing rules

The Canada Revenue Agency (CRA) addresses telecom sourcing rules in its GST/HST Technical Information Bulletin B-103. The AFC tax engine applies these sourcing rules to telecommunications services provided in Canada.

The document states the following:

A supply of a telecommunication service of making telecommunications facilities available (other than a service of granting sole access to a telecommunications channel) is made in a province if:

  • all of the facilities are ordinarily located in that province; or
  • where not all of the facilities are ordinarily located in the province, the invoice for the supply is sent to an address in that province.

For other types of supplies of telecommunication services (other than a service of granting sole access to a telecommunications channel), the supply is made in a province if the telecommunication:

  • is both emitted and received in that province;
  • is either emitted or received in that province and the billing location for the service is located in that province; or
  • is emitted in the province and received outside the province and the billing location for the service is not in a province where the telecommunication is emitted or received.

India

Effective 1 July 2017, India replaced its indirect tax system with a goods and services tax (GST). This new structure includes separate rates for general goods and services and telecommunications services.

Indian states and territories are available in the AFC tax engine (see Indian States for a complete list). In order to accurately return interstate supply and intrastate supply tax results, it is necessary to pass the associated transaction with the proper state.

Interstate Supply occurs where the location of the supplier and the place of supply of goods are in (a) two different States; (b) two different Union territories; or (c) a State and a Union territory.

When passing a sale of interstate goods or services in India, use International/Product – India Interstate Supply (T/S pair 14/658). When passing a sale of an interstate telecommunications service in India, use Telephony – India Interstate Service (T/S pair 15/656).

Intrastate Supply occurs where the location of the supplier and the place of supply of goods are in the same State or same Union territory.

When passing a sale of intrastate goods or services in India, use International/Product – India Intrastate Supply (T/S pair 14/659). When passing a sale of an intrastate telecommunications service in India, use Telephony/India Intrastate Supply (T/S pair 15/657).

The following Transaction/Service pairs should be used to return taxation in India:

Transaction Type

Service Type

Name

Description

14

658

International/Product - India Interstate Supply

Supply of goods for consideration within India in which the location of the supplier and the place of supply occur in different states or territories.

14

659

International/Product - India Intrastate Supply

Supply of goods for consideration within India in which the location of the supplier and the place of supply occur in the same state or territory.

15

656

Telephony/Service - India Interstate Supply

Telephone service in India in which the location of the supplier and the place of supply occur in different states or territories.

15

657

Telephony/Service - India Intrastate Supply

Telephone service in India in which the location of the supplier and the place of supply occur in the same state or territory.

 

The following Tax Types will return in India:

Tax

Tax Type

Tax Level

Description

IGST

488

0 (Federal)

Integrated goods and service tax based on consumption.

IGST (Communications)

482

0 (Federal)

Integrated goods and service tax based on consumption but applied only to communications services.

CGST

483

0 (Federal)

National goods and service tax based on consumption within the boundary of a state or territory.

CGST (Communications)

484

0 (Federal)

Similar to Tax Type 483 (CGST) but applied only to communications services.

SGST

485

1 (State)

State goods and service tax based on consumption within the boundary of a state or territory.

SGST (Communications)

486

1 (State)

Similar to Tax Type 485 (SGST) but applied only to communications services.

China

China uses the Transaction/Service pairs and Tax Types as listed in Section 2. 

Hong Kong

Hong Kong has different taxation rules than other locations in China. To return proper taxation, Hong Kong should be specified as a state within China using the two-letter state code HK or PCode 5101401.

Although valid Transaction/Service pairs utilized in Hong Kong are the same as those used for China, the VAT rate is not returned in Hong Kong.

Country Code

State Code

PCode

CHN

HK

5101401

United States Territories

To return proper taxation for US Territories, Territories should be specified as a state within the US using the two letter state code.

Valid Transaction/Service pairs utilized in US Territories are the same as those used for US mapping, encompassing the full spectrum of telecom products and services as listed in the TM_00115_AFC Transaction and Service Types document.

Do not attempt to use International Transaction Type (14) or Telephony Transaction Type (15) in US Territories.

Country

US Territory Name

FIPS State Alpha Code

United States of America

American Samoa

AS

United States of America

Federated States of Micronesia

FM

United States of America

Guam

GU

United States of America

Marshall Islands

MH

United States of America

Northern Mariana Islands

MP

United States of America

Palau

PW

United States of America

Puerto Rico

PR

United States of America

Virgin Islands of the U.S.

VI

Populating Data

The data required for accurate taxation varies from service type to service type. The following chart lists which data to populate for each service type.

Transaction Type

Service Type

Description

Required Input Data

14

15

International/Product

Amount

14 636 International/Remotely Accessed Software Amount

14

658

International/Product - India Interstate Supply

Amount

14

659

International/Product - India Intrastate Supply

Amount

 14 676 International/Digital Downloaded Audio Amount
 14 677 International/Digital Streaming Audio Amount
 14 678 International/Digital Downloaded Video Amount
 14 679 International/Digital Streaming Video Amount
 14 680 International/Digital Downloaded Video Game Amount
 14 681 International/Digital Streaming Video Game Amount
 14 682 International/Downloaded Software Amount

15

7

Telephony/Service

Amount, Minutes

15

624

Telephony/Wireless Service

Amount, Minutes

15

627

Telephony/Internet Access

Amount, Minutes

15

629

Telephony/Messaging Services

Amount

15

656

Telephony/Service - India Interstate Supply

Amount

15

657

Telephony/Service - India Intrastate Supply

Amount

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