If you need to exempt a Canadian customer from both federal GST and provincial tax (PST, QST, or HST), add multijurisdictional exemption details for the customer. Multijurisdictional exemptions must be created directly in AvaTax, and can't be imported.
Before you begin
You may need to:
- In AvaTax, select Exemptions.
The Customer Exemptions page opens.
- Find your exempt customer in the list and select Add an Exemption.
- Select Canada in the Issuing Country field.
- Select an exempt reason from the Entity Use Code field:
- Refer to the Exempt Reason Matrix for a list of valid reasons by region.
- If you need to fully exempt the customer from GST and all provincial tax, select Tribal Government.
Tribal Government is the only entity use code that exempts Canada (GST) tax and all provincial taxes. You can select a different entity use code if your customer is not exempt from Canada (GST), or if they are exempt from GST but taxable at the provincial level.
- Select the exempt regions.
Regions can only be added if your selected Entity Use Code is valid there.
- To exempt all tax: Select Canada (GST) and all provinces in which you do business.
- To exempt only the federal Canada GST rate: Select Canada (GST).
- To exempt GST and HST: Select Canada (GST) and any of the HST provinces in which you do business: New Brunswick, Newfoundland and Labrador, Nova Scotia, Ontario, and Prince Edward Island.
- To exempt PST/QST but still charge GST: Select the provinces that you want to be exempt, but do not select Canada (GST).
- Select Next.
- Add exemption information:
- Exemption Number - A unique number found on a customer's exemption document.
- Exemption Number Type - Typically an exemption number or taxpayer ID. Certain exemptions may require a Foreign Diplomat Number, Driver's License, or FEIN.
- Effective - The beginning of the exemption period.
- Expiration - When the exemption no longer applies to the customer.
- Select Request a Certificate or Upload a Certificate to attach a PDF file to the customer record.
- Request - An email is sent to your customer with a secure link to complete and return the right exemption document.
- Upload - When you have a digital copy of your customer's exemption document.
- Select Save.
Your customer is now exempted from both Canada (GST) and provincial tax for the provinces you selected.