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. |
607 | NHIL | A tax on goods and services to support National Health Insurance. |
608 | GETFund Levy | A tax on goods and services to support the Ghana Education Trust Fund. |
609 | Covid 19 Levy | A tax on goods and services to raise revenue to support Covid 19 expenditures. |
610 |
VAT (Increased Rate) |
Similar to VAT (Tax Type 65) but applied at an increased rate. |
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 regions guide 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. |
Retail Sales Tax (RST) | 606 | 1 (State) | A tax applied to the retail sale or rental of goods and services. |
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 |