US and Canada Returns
Updated June 10, 2015
1. Tax Filing Calendar. Customer acknowledges and agrees that Customer is solely responsible for accurately completing and maintaining Customer’s tax filing calendar for each separate reporting entity for which Avalara is to file. Customer shall inform Avalara of any tax filing calendar changes before the fifth (5th) calendar day of the month following the effective date of those changes. Any changes received after the fifth (5th) calendar day will be implemented and become effective in the subsequent month. The tax filing calendar instructs Avalara on where and when Customer wants to file taxes, and provides registration numbers and other information to assist Avalara with administering returns. Customer agrees to use Avalara to remit all applicable returns in tax jurisdictions where Customer has set up a tax filing calendar within Avalara AvaTax. Avalara does not remit returns in jurisdictions where a Customer has not provided Avalara with valid tax vendor registration numbers together with complete Tax Data (defined below) and any other information required to form a complete Return. Customer acknowledges and agrees that Avalara does not audit, validate, or verify (a) the accuracy of Customer’s tax filing calendar; and (b) whether Customer is properly filing returns in all jurisdictions in which Customer is required to file.
2. Tax Data. Customer is solely responsible for the accuracy and completeness of all the data necessary to properly complete a tax return (the “Tax Data”). Avalara does not audit, validate, or verify Tax Data.
3. Return Preparation. Customer shall transmit via the console all Tax Data that is to be included in Customer’s Return before the 10th calendar day of the month, unless otherwise specified in a written agreement. Customers utilizing Avalara for Data Transformation Services shall deliver all Tax Data to Avalara by the 5th calendar day of the month, unless otherwise specified in a written agreement. Avalara will generate and display an online tax liability worksheet (the “Worksheet”) in the Customer console based on transmitted Tax Data received from Customer for Customer’s review and approval. The Avalara Technology will automatically update the Worksheet daily to include new or edited data up to the point Customer approves a particular state or the point the Worksheet is locked. No later than the 10th calendar day of each month, Customer shall confirm the accuracy of the Worksheet Customer is solely responsible for the accuracy and completeness of tax liabilities shown on the Worksheet, including, but not limited to, making any manual or credit adjustments. The Worksheet will lock automatically and will be deemed approved by Customer after the 10th calendar day and no changes may be made to such Worksheet after the 10th calendar day unless otherwise mutually agreed in writing. Avalara reserves the right to charge Customer’s payment information on file a fee: (a) to unlock Tax Data in the Worksheet after it has been locked; and (b) to change or reconcile requests received after the 10th calendar day that force adjustments to returns already created; or (c) to make a change to Customer’s Worksheet, Return, filing calendar, remittance or Avalara processes that impedes the progress of compliance or treasury functions. If Customer timely transmits via the console all Tax Data before the 10th calendar day of each month, Avalara will remit Customer’s returns by the applicable filing deadline).
4. Treasury. Unless another funding process has been implemented by mutual agreement, Customer agrees to execute a limited power of attorney in favor of Avalara and provide designated bank account information (“Bank Account”) for the purpose of paying outstanding tax obligations and, if applicable, paying Avalara Returns Service fees, unless Customer has designated and funded another account from which Avalara shall be entitled to withdraw Avalara Returns usage and Services fees. Customer agrees to fully fund the Bank Account within the deadlines established by Avalara. After the Worksheet has been approved or locked as provided in Section 3 above, Avalara will provide Customer with the tax amount due on the Worksheet in the console for Customer’s reference. Avalara will automatically withdraw tax amounts due (“Tax Funds”) from the Bank Account pursuant to the limited power of attorney between the 11th and 14th calendar day of the month. Customers whose filing calendars include prepayment obligations agree to authorize Avalara to withdraw funding prior to the 11th in order to meet earlier prepayment deadlines. If applicable, Avalara will also provide a report of fees for Avalara Returns services and charge Customer’s payment information on file for any amounts owing. If at any time during reconciliation of Customer’s account a balance is found to be owing in order to fully fund Customer’s tax obligations, Avalara shall immediately collect the funds by withdrawing the balance owed, unless another payment method is agreed. Avalara shall hold the Tax Funds withdrawn from the Bank Account for taxes due in a trust account prior to disbursement to the taxing authority. Avalara acknowledges and agrees that all Tax Funds collected or received from Customer belong to, and will be held in trust for the benefit of, the individual taxing authorities to which such Tax Funds are due and the Tax Funds shall not be commingled with Avalara’s general funds but may be deposited with funds also held in trust on behalf of other taxpayer customers of Avalara.
6. Notice Management. Customer acknowledges that Customer will receive all notices relating to Customer’s returns directly from taxing authorities. Accordingly, Customer agrees to release, defend, indemnify and hold harmless Avalara and its Affiliates, subsidiaries, officers, directors and employees from any assessments (including, but not limited to, all penalties and interest) assessed against Customer as a result of or based on Customer’s: (a) failure to immediately deliver to Avalara any notice from a taxing authority; or (b) election to manage notices from taxing authorities on Customer’s own. In addition, on behalf of Customer and its successors and assigns, Customer waives any claim against Avalara and its Affiliates, subsidiaries, officers, directors and employees relating to the foregoing.
7. Adjusted Per-Form Fee. Avalara charges a certain per-form fee based on the specific plan Customer purchased. Avalara reserves the right to adjust this per-form fee if the actual number of returns Customer files in a given year is fewer than the minimum amount of Customer’s Avalara Returns plan level and falls under an Avalara Returns plan that requires fewer returns to be filed and, as a result, has a higher per-form fee. By way of illustration and not of limitation, if Customer’s Avalara Returns plan requires Customer to file at least 361 returns each year, but Customer only files 100 returns in a given year, then effective upon the start of any Renewal Term, Avalara may adjust the per-form fee charged to Customer to the then-applicable per-form fee for the Avalara Returns plan level that pertains to filing 100 returns per year.
8. Minimum Monthly Fee for Buy Down Customers. If Avalara has not received a complete tax filing calendar and an executed funding power of attorney (the “Onboarding Requirements”) from Customer within 90 days following the Contract Effective Date (“Avalara Returns Commencement Deadline”) Avalara reserves the right to charge Customer a monthly minimum Avalara Returns Service fee (“Minimum Returns Fee”). Customer’s Minimum Returns Fee is calculated using the lowest number of returns required to be filed under Customer’s annual plan multiplied by the per-form fee under the plan, divided by 12. By way of illustration and not limitation, if Customer has not filed a return by the Avalara Returns Commencement Deadline and Customer is required to file at least 13 returns each year with a per-form fee of $54, then Avalara will charge Customer’s payment information on file a $59 fee in the calendar month following the Avalara Returns Commencement Deadline and for each month thereafter until Customer completes the Onboarding Requirements. The foregoing monthly fee is calculated as follows: (13 x $54)/12). Avalara will no longer charge Customer the Minimum Returns Fee when Customer completes the Onboarding Requirements.
9. Buy Down Account; Cancellation Option. A Customer purchasing the lowest tier of Avalara Returns Services under the Buy Down plan is required to begin filing returns by the Avalara Returns Commencement Deadline unless otherwise agreed. If the Avalara Returns Commencement Deadline has passed and Customer has yet to complete the Onboarding Requirements, Avalara reserves the right to cancel Customer’s Avalara Returns Service and retain all prepaid fees for the cancelled Service.
10. Account Activation and Access: Unless otherwise agreed, Customer shall provide Avalara with the Tax Data to enable Avalara to file Returns on Customer’s behalf within 30 days’ of the Contract Effective Date, to include the following: copies of Customer’s Returns filing calendar, all information necessary to gain access to Customer’s DOR accounts, copies of past filings and all related information necessary to complete the setup and configuration of Returns filing in every jurisdiction in which Customer has authorized Avalara to file Returns on Customer’s behalf. Failure to provide the information requested in the time frame specified may result in additional managed services fees applied to Customer’s account, unless otherwise agreed. Customer will be notified in advance of any managed service fees that may be charged to Customer’s account, including the applicable rate for such fees.
11. Overage Charge. If Customer exceeds the Avalara Returns Service plan level purchased and Customer utilizes Avalara Returns without upgrading to a higher tier, Customer will be charged for the use of any additional returns at the per return price associated with Customer’s purchased plan level for the then-current term.
12. Remedies. NOTWITHSTANDING ANY OTHER PROVISION OF THIS AGREEMENT: (A) CUSTOMER AGREES TO DEFEND, INDEMNIFY AND HOLD AVALARA AND ITS AFFILIATES, SUBSIDIARIES, LICENSORS, OFFICERS, DIRECTORS AND EMPLOYEES HARMLESS FROM ANY LOSS, COST, DAMAGE, LIABILITY OR EXPENSE (INCLUDING, BUT NOT LIMITED TO, REASONABLE ATTORNEYS’ FEES), ARISING OUT OF OR RELATED TO CUSTOMER’S FAILURE TO PROVIDE IMMEDIATELY AVAILABLE TAX FUNDS FOR CUSTOMER’S TAX LIABILITIES DUE; AND (B) IN THE EVENT OF THEFT OR FRAUD BY AN AVALARA EMPLOYEE PURSUANT TO WHICH CUSTOMER SUFFERS AN ACTUAL MONETARY LOSS, AVALARA AGREES TO REFUND CUSTOMER THE ACTUAL AMOUNT OF THE LOSS WITHIN A REASONABLE PERIOD FOLLOWING DISCOVERY. THIS SECTION 11 SHALL SURVIVE ANY EXPIRATION, NON-RENEWAL, SUSPENSION OR TERMINATION OF THIS AGREEMENT.
13. Limited Warranty. AVALARA MAKES THE LIMITED WARRANTY THAT AVALARA WILL PAY THE TAX PENALTIES AND INTEREST ACTUALLY IMPOSED ON CUSTOMER BY A TAXING AUTHORITY PROVIDED ALL OF THE FOLLOWING CONDITIONS ARE SATISFIED: (A) THE PENALTY AND INTEREST IMPOSED AROSE SOLELY FROM OUR ERROR IN TIMELY PERFORMING AVALARA RETURNS SERVICES; (B) CUSTOMER HAS FULFILLED ALL OF ITS MATERIAL OBLIGATIONS UNDER THIS AGREEMENT ( (C) CUSTOMER HAS PROMPTLY FORWARDED ANY NOTICES AND RELEVANT INFORMATION FROM TAXING AUTHORITIES TO US; AND (D) CUSTOMER HAS COOPERATED WITH AVALARA’S EFFORTS TO ABATE OR REDUCE THE AMOUNT OF PENALTY AND INTEREST IMPOSED.
14. Survival. All provisions that by their nature should survive termination, non-renewal, expiration or suspension will do so (including, by way of example and not limitation, payment obligations, indemnification and defense obligations and duties of confidentiality).