About the Avalara VAT Reporting Integration

Note: As of Spring 2022 the Avalara SaaS Settings custom setting is called Avalara VAT Reporting SaaS Settings .

Avalara VAT Reporting is a third-party application that enables you to file your VAT returns and other indirect tax compliance reports in 35 countries, including all EU member states. By using the integration, you can send your financial data from Accounting to Avalara VAT Reporting.

Note:

If your company is based in the United Kingdom, you can use the VAT Reporting package instead of the Avalara VAT Reporting integration. For more information, see the Getting Started with VAT Reporting guide available in the Certinia Community.

Avalara VAT Reporting accepts XML documents that contain transaction data generated from Accounting. This enables you to send your sales and purchase invoices, as well as sales and purchase credit notes to Avalara VAT Reporting and report on them to the appropriate authority.

XML documents are generated using a scheduler with a predetermined frequency. Once the documents are generated, they are automatically sent to Avalara and stored in Avalara SaaS. To enable the generation of XML documents, you must configure the fields in the Avalara VAT Reporting Settings custom setting. For more information, see Setting Up the Avalara VAT Reporting Integration.

The integration is preconfigured to work with the following localizations of Accounting :

  • Belgium and Luxembourg
  • Denmark and Finland
  • France
  • Germany and Switzerland
  • Italy
  • Netherlands
  • Spain
  • Sweden and Norway

For countries not on this list, you might need to map specific fields. For more information, see About the Avalara VAT Reporting Mappings.

For more information see, Using Localization.

Limitation - Journal Documents

Avalara VAT Reporting does not support journal documents. If you make tax adjustments using a journal, that tax amount is not reported in your VAT return.

An example of the possible importance of journals is when correcting tax code errors. For example, if in a sales invoice you incorrectly entered the tax code as an input tax code, instead of an output tax code. If this same invoice is already posted, you might create an additional journal line item in order to correct the tax code error, like in the table below. This is common practice in the UK, but not allowed in other countries, for example Spain.

Journal Line Items

Line Number

Line Type

General Ledger Account

Tax Code

Taxable Value

Debit/Credit

Value

1 Tax Code 2170 - VAT Input VI-S 10,000.00 Debit 2,000.00
2 Tax Code 2180 - VAT Output VO-S -10,000.00 Credit 2,000.00

Workarounds

  1. Recommended - Credit the incorrect invoice. Create a credit note document canceling the original invoice. Then create a new invoice with the correct values. By doing this, no manual adjustment is required in the Avalara environment, and there is no need to keep both Accounting and Avalara balanced, because the background process collects the information, which is already fixed.
  2. Create a manual document in the Avalara VAT Reporting environment, in the same way as the table above. However, in this case you must also apply the adjustment in Avalara to keep both Accounting and Avalara balanced.