Avalara Returns Supplemental Terms
US and Canada Returns
Updated January 1, 2019
These Avalara Returns Supplemental Terms (“Returns Terms”) govern Customer’s purchase and use of Avalara Returns. These Returns Terms are in addition to, and incorporate by reference, the Avalara Terms and Conditions available at www.avalara.com/terms (the “Terms”). Any capitalized terms used in these Returns Terms and not defined have the meanings given in the Terms.
- Use of the Services.
- Customer Obligations.
a. 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”) and all Filing Information. Avalara does not audit, validate, or verify Tax Data. Customer shall transmit to Avalara via the method designated by Avalara all Tax Data for Customer’s Return(s) before the Tax Liability Approval Deadline (defined in Section 2(b) below). However, Customers utilizing Avalara for Data Transformation Services shall deliver all Tax Data to Avalara by the 5th calendar day of the month in which the Tax Data is to be reported to the Filing Jurisdictions. “Data Transformation Services” are Services where Avalara, pursuant to a signed SOW, will convert Customer’s transactional data that meets Avalara’s minimum transactional data requirements into a complete data set that permits import into Customer’s Account. Data Transformation Services are performed at Customer’s direction and expense, and the resulting data set is part of Customer’s Tax Data.
b. Tax Liability. Customer will be able to view and approve Customer’s tax liabilities to Filing Jurisdictions, which are based on the Tax Data (each, a “Tax Liability”). Customer is solely responsible for the accuracy and completeness of Customer’s Tax Liability and may modify its Tax Liability up to the deadline specified in the Documentation for Returns to be filed in that month (“Tax Liability Approval Deadline”). Customer’s Tax Liability is updated daily to include new or edited data until the earlier of approval by Customer or the Tax Liability Approval Deadline. After the Tax Liability Approval Deadline, Customer’s Tax Liability is locked and deemed approved by Customer. Customer’s Account will display any tax amounts due (the “Taxes”) based on the approved Tax Liability.
c. Funding. In accordance with this Section 2(c), Customer shall timely make sufficient funds available to pay the Taxes for any applicable Return (“Tax Funds”) prior to the deadline specified in the Documentation. Avalara shall not provide any Tax Funds. Notwithstanding any other provision of the Agreement, Customer shall defend, indemnify, and hold Avalara, its Affiliates, and their respective licensors, officers, directors, employees, agents, and representatives harmless from any Losses arising out of or related to Customer’s failure to timely provide immediately available Tax Funds. In order for the Tax Funds to be remitted timely to the applicable Filing Jurisdiction, Customer must do the following:
i. Customer shall execute limited power(s) of attorney in the form requested by Avalara. Upon termination of Customer’s subscription to Avalara Returns, Avalara will cease to use any power or authority granted by a power of attorney signed by Customer.
ii. Customer shall provide bank account information for a bank account from which Customer authorizes Avalara to draw by ACH to pay Customer’s Taxes and any applicable Avalara Returns fees (the “Bank Account”) by the deadline specified in the Documentation. If the ACH payment Avalara draws from the Bank Account is cancelled or returned other than by Avalara, that will be considered a failure to timely fund the Bank Account.
iii. Customer shall ensure the Bank Account has sufficient Tax Funds to pay the Taxes and, if applicable, Customer’s Avalara Returns fees by the deadlines in the Documentation. If Customer fails to timely fund the Bank Account, Customer shall remit payment for the Taxes directly to the applicable Filing Jurisdiction plus any interest or penalties that may accrue. Avalara may suspend or terminate Customer’s subscription to the Avalara Returns immediately upon notice if Customer fails to timely and sufficiently fund the Bank Account.
iv. Customer authorizes Avalara to (i) withdraw the Tax Funds to pay the Taxes in accordance with the Filing Calendar, including making any required prepayments; and (ii) if applicable, withdraw Customer’s Avalara Returns fees.
- Avalara Obligations
- Notice Management. Customer will receive all notices relating to Customer’s Returns directly from Filing Jurisdictions. Some notices are informational in nature (for example, changes to the Filing Calendar or tax rate changes) while others are error notices relating to the Return(s). In the Documentation, Avalara provides recommended actions for Customers to resolve informational notices. For any error notices relating to a Return filed or Taxes remitted by Avalara, Customer shall immediately, and not later than 10 business days after the date of the notice, electronically deliver to Avalara any such notice from a Filing Jurisdiction. Such notice must be sent to email@example.com. Avalara will respond to notices for Returns filed and Taxes remitted by Avalara but may delay response or not respond to notices received more than 10 business days after the date of the notice or, at Avalara’s sole discretion, charge an additional fee to expedite the notice response. Customer will be responsible for responding to, or otherwise addressing, all other notices.
- Extractors. For Customers who purchase Extractors, fees for each Extractor are based on the number of Extractor Transactions purchased for use in the Extractor by Customer. An “Extractor Transaction” is any record that is entered, uploaded, or otherwise recorded in Avalara Returns by Customer using an Extractor. Records include, for example, committed sales invoices, purchase invoices, inventory transfer invoices, return invoices, and committed e-commerce shopping carts. Each such record will count as one Extractor Transaction for purposes of calculating usage of the Extractor, as will each subsequent alteration of the record. If Customer exceeds the number of Extractor Transactions set forth in its Order Document, Customer will be automatically upgraded to the next highest subscription tier and may not opt out of this automatic upgrade.
- Returns Guarantee. Avalara provides a guarantee of the timeliness of Returns prepared and filed through Avalara Returns (the “Returns Guarantee”) under the following terms:
- Fees. Customer agrees to pay fees for Avalara Returns based on Customer’s subscription plan and usage of Avalara Returns. Customer shall participate in Avalara’s automatic payment option for Avalara Returns and either authorizes Avalara to draw from the Bank Account by ACH transfer to pay Avalara Returns fees or will designate another automatic payment method for Avalara Returns fees.
- Termination. Notwithstanding anything to the contrary in the Terms, Customer’s Avalara Returns subscription will terminate on the last calendar day of the month in which the subscription would otherwise have terminated under the Terms. Customer may instruct Avalara not to file in that or any other month by revising its Filing Calendar.
- Compliance with NACHA Operating Rules. The funding process described in Section 3(b) (Funding) may be subject to the Operating Rules of NACHA, the organization that regulates the ACH network in the United States.
a. Account Set-Up. Customer shall provide Avalara with all information requested by Avalara to establish and set up Customer’s account for Avalara Returns (the “Onboarding Requirements”). Such information includes: (i) a list of taxing jurisdictions for which Customer requests Avalara prepare returns (each a “Filing Jurisdiction”); (ii) the dates for filing Returns (defined in Section 3(a) below) in each of the Filing Jurisdictions (the “Filing Calendar”); (iii) the entities (e.g., Customer or its Affiliates) for which Avalara will be preparing Returns (the “Filing Entities”); (iv) tax registration numbers and log-in information for each entity in each Filing Jurisdiction sufficient to allow Avalara to identify and access Customer’s account in that Filing Jurisdiction (the “Account Information”); (v) copies of previous filings in the Filing Jurisdictions, as requested by Avalara; (vi) completed power(s) of attorney, including the power of attorney described in Section 2(c)(1) below; and (vii) other information necessary to properly configure Customer’s Account and prepare the Returns. Customer authorizes Avalara to access Customer’s accounts using Customer’s Account Information. Customer is solely responsible for timely providing and maintaining accurate, complete, and current information regarding the Filing Jurisdictions, the Filing Calendar, the Filing Entities, and the Account Information (collectively, the “Filing Information”), and Avalara has no obligation to audit, verify, correct, or maintain any Filing Information.
b. Changes to Filing Information. Customer shall review its Filing Information periodically and shall promptly communicate any changes to Avalara. Customer shall submit any changes to the Filing Information to Avalara no later than the last calendar day of the month to which the Tax Data is attributed. If Customer’s information is stored by a Filing Jurisdiction, Avalara may receive that information directly from the Filing Jurisdiction and update the Filing Information accordingly. Any changes received after the last calendar day of the month will be implemented and become effective in the subsequent month.
a. Sales and Use Tax Returns Preparation and Filing. Avalara will prepare Returns for Customer in the Filing Jurisdictions. Avalara will file the Return for those Filing Jurisdictions for which Avalara and Customer have agreed Avalara will file. Avalara may begin filing a Return as soon as Customer approves the related Tax Liability. Each standard sales and use tax return filing or Non-Standard Form (defined below) prepared for one Filing Jurisdiction for one filing period will count as one “Return.”
b. Funding. Avalara shall not provide funds to pay Taxes. For those Filing Jurisdictions for which Avalara and Customer have agreed to file, if Tax Funds are not timely available to Avalara, Avalara will remit the Return(s) without payment.
i. Avalara will draw upon the Bank Account to pay the Taxes. Typically, these draws occur between the 11th and 14th day of the month, but may occur without notice at any time after the Tax Liability Approval Deadline. Notwithstanding the foregoing, if Customer owes any pre-payments to Filing Jurisdictions, the draw may occur earlier.
ii. Each month, if applicable, Avalara will draw upon the Bank Account to pay Avalara Returns fees due.
iii. Avalara shall hold the Tax Funds in a trust account prior to disbursement to the applicable Filing Jurisdiction. Avalara holds all Tax Funds in trust for the benefit of the applicable Filing Jurisdiction and shall not comingle the Tax Funds with its general funds, but may comingle with funds held in trust on behalf of other Avalara customers. Any interest earned on the Tax Funds accrues for the benefit of and is the sole property of Avalara.
a. If Customer receives a notice of late filing, failure to file, or a failure to remit Taxes that results in liability for penalties or interest due solely to Avalara’s failure to timely prepare and file a Return it was obligated to file or to timely remit Taxes it was obligated to remit (an “Avalara Error”), Avalara will pay Customer the lesser of either: (i) the amount of the penalties and interest that directly result from the Avalara Error, as specified in the final assessment notice received from the applicable Filing Jurisdiction, or (ii) the amount of the Avalara Returns fees paid by Customer during the 365 days preceding the final assessment of penalties or interest for the Avalara Error (calculated as described in subsection (c) below).
b. The following conditions apply to the Returns Guarantee:
i. Customer must have met all of its obligations under these Returns Terms, including providing and maintaining accurate, complete, and current Filing Information and Tax Data, timely providing all Tax Funds, and timely paying Avalara Returns fees. To the extent the Avalara Error was caused by Customer’s failure to perform any of the obligations in these Returns Terms, the Returns Guarantee will not apply.
ii. Customer must not have requested changes to Customer’s Tax Liability after the Tax Liability Approval Deadline.
iii. Customer must promptly forward any notices and relevant information from the Filing Jurisdiction within 10 days of the date of the notice.
iv. Customer must assist Avalara in challenging the Filing Jurisdiction’s findings if Avalara deems it appropriate in Avalara’s sole discretion.
v. Customer must assist Avalara’s efforts to abate or reduce the amount of penalties or interest imposed by the Filing Jurisdiction.
c. For purposes of calculating the amount of the Avalara Returns fees paid that are eligible for theReturns Guarantee payment, the amount will be the fees actually paid by Customer to Avalara for Avalara Returns, and the time period will be the 365 days preceding the final assessment of penalties or interest after all appeals and abatement options have been exhausted.
d. In the event that (i) Customer ultimately settles with the Filing Jurisdiction for less than the full amount claimed by that Filing Jurisdiction, (ii) the audit implicates other issues in addition to the alleged Avalara Error, and (iii) the settlement does not specifically apportion the settlement amounts between the audit issues, the amount to be paid by Avalara under this Returns Guarantee will be the percentage of the settlement amount equal to the percentage of the entire settled claim (as such claim existed at the time of settlement) related to the alleged Avalara Error.
e. Avalara will make the Returns Guarantee payment within 30 days after the date that Customer receives the final assessment notice from the applicable Filing Jurisdiction, after all administrative appeals are exhausted. Avalara may also, in its sole discretion, make the payment at an earlier date, in which case Customer’s obligations to continue to assist Avalara in contesting the Avalara Error will cease on the date of the payment.
f. Customer must have a current Avalara Returns subscription in good standing to be eligible to receive payment under this Returns Guarantee.
a. Per-Return Fees. The per-Return fee specified in Customer’s subscription plan is based on Customer’s estimated annual usage. Avalara reserves the right to adjust Customer’s per-Return fee at the beginning of any Renewal Subscription Term if the actual number of Returns prepared during the Subscription Term just ended is fewer than the minimum number included in Customer’s Avalara Returns plan level. For example, if Customer’s Avalara Returns plan requires Customer to file at least 361 Returns each year, but Customer files only 100 Returns in a given year, then, effective upon the start of any Renewal Subscription Term, Avalara may adjust the per-form fee charged to Customer to the then-applicable per-Return fee for the Avalara Returns plan level that pertains to filing 100 Returns per year.
b. Minimum Monthly Fee. If Customer has purchased a subscription plan with a minimum number of annual Returns required, Avalara reserves the right to begin billing Customer a monthly minimum Avalara Returns fee (“Minimum Returns Fee”) if Customer has not provided to Avalara the Onboarding Requirements within 90 days following the Effective Date (“Avalara Returns Commencement Deadline”). Customer’s Minimum Returns Fee is calculated using the lowest number of Returns required to be filed under Customer’s subscription plan multiplied by the per-Return fee under that plan, divided by 12 and rounded up to the nearest dollar. For example, 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-Return fee of $54, then Avalara will charge Customer’s payment information on file a $59 fee (13 x $54)/12) in the calendar month following the Avalara Returns Commencement Deadline and for each month thereafter until Customer completes the Onboarding Requirements. Avalara will stop charging Customer the Minimum Returns Fee when Customer completes the Onboarding Requirements and begins filing Returns.
c. Avalara Cancellation Option. If Customer has not begun filing Returns by the Avalara Returns Commencement Deadline, Avalara reserves the right to cancel Customer’s Avalara Returns subscription and retain all prepaid fees for the cancelled Service.
d. Overage Charge. If Customer exceeds Customer’s Avalara Returns subscription and utilizes Avalara Returns without upgrading to a higher tier, Customer will be charged for any additional Returns at the per-Return price associated with Customer’s purchased subscription tier through the end of the Subscription Term.
e. Non-Standard Forms. If Customer requests (i) a form that is not offered by Avalara as a standard sales and use tax return; or (ii) a standard sales and use tax return that requires non-standard modifications to the standard sale and use tax return form (each a “Non-Standard Form”), Customer shall pay the per-hour rate for the Non-Standard Form in 1/4th hour increments (one quarter hour minimum per Non-Standard Form).
f. Other Additional Fees. If Customer fails to timely and completely provide accurate Filing Information, Tax Data, or Tax Funds, if applicable, or otherwise fails to fulfill any obligations under these Returns Terms, Avalara may charge Customer additional fees. For example, Avalara may charge a fee: (i) if Customer does not provide Tax Funds prior to the deadline; (ii) for Avalara to unlock Customer’s Tax Liability after it has been approved by Customer; (iii) for Avalara to change or reconcile requests received after the Tax Liability Approval Deadline; (iv) for Avalara to change the funding process because Customer has not timely funded the Bank Account; or (v) for Avalara to make a change to Customer’s Tax Liability, Filing Information, Return(s), Tax Data, Tax Funds to be remitted, or any other Avalara process.
g. No Automatic Upgrade. Notwithstanding anything to the contrary in the Terms and except as provided above in Section 5 (Extractors), Customer’s Avalara Returns subscription will not be automatically upgraded to the next highest subscription tier.
a. To the extent that Customer’s funding is governed by the NACHA Operation Rules, Customer specifically agrees to the following NACHA requirements:
i. Customer will comply with all applicable requirements under the then-current version of the NACHA Operating Rules;
ii. Customer authorizes Avalara to originate the funding requests described in Section 3(b) (Funding) above;
iii. Customer will comply with the laws of the United States in providing such funding;
b. In addition to any other applicable termination rights, Avalara may terminate the Agreement for Customer’s non-compliance with the NACHA Operating Rules if such breach or non-compliance is not cured within 10 days of Avalara first notifying Customer of its non-compliance;
c. Avalara shall have the right to audit Customer’s funding process, at a time and location mutually agreeable to both Customer and Avalara, to ensure compliance with the NACHA Operating Rules and the Agreement.