Location-specific tax details for partners in the CSP program
Appropriate roles: Global admin
The Cloud Solution Provider (CSP) program is a sales channel focused on partner resale of products. As a result, Microsoft isn't always required to charge sales tax on partner invoices. The rules on taxes and tax exemptions vary by country or region.
In this article, you'll find location-specific tax exemption information and learn how to view digital signatures. Work with your tax advisor to file tax exemptions based on your location and the locations of your customers.
Country and region tax details
Tax-related information for Canada and the United States is available. For information about other countries/regions, jump to Other regions.
Most resellers aren't exempt from goods and services tax (GST)/harmonized sales tax (HST)/Quebec sales tax (QST). Consult your tax advisor to determine whether you're qualified for exemption, and what documentation you should provide to Microsoft. The tax is displayed in two separate lines for Canada: GST/HST and PST/QST.
For a BC provincial sales tax (PST) exemption, file a tax exemption as described. Provide your BC PST#, or a completed and signed Certificate of Exemption General.
Resellers in the United States who want to claim sales tax exemption must provide proof exemption within 30 days of accepting the Microsoft Reseller Agreement. Each state has different exemption certificates for resale. Work with your tax advisor to determine what is relevant for your legal address and registered states.
In the United States, including Puerto Rico, sales and use tax must be separately stated. Effective August 2021, the tax is stated separately on the Microsoft invoice unless otherwise noted. Furthermore, the Puerto Rico tax is stated separately at the commonwealth and municipal level as Commonwealth Tax and Municipal Tax. This may include resale exemption certificates that work across multiple states, such as the Streamline Sales and Use Tax Agreement Certificate of Exemption or the MTC Uniform Sales & Use Tax Exemption Certificate.
Starting October 1, Russian Regulation states that all billing to Russian Businesses from a Foreign Company should be charged with 0% VAT. We're working on a solution to correct the Vatable position on your seat-based and usage-based ("D") invoices. While we work to implement this change, you may pay your invoices in full, and corrections will be applied to your next future invoice in the form of tax credit.
Further notification will be sent to update you on this course of action. For one-time, Azure Plan and New commerce seat-based ("G") invoices, the updated VAT % will reflect in your November 6 invoice for the period of October with no tax credits required.
If you are in another country or region that charges taxes, request support through Partner Center for your questions.
View digitally signed invoices in India
Partners in India can view digitally signed invoices. You'll need Adobe Acrobat Reader Document Cloud (DC) to view a signature.
If you created the order in Partner Center, you'll receive a digital copy of an invoice in email.
Select the invoice, which will open from within Adobe Acrobat Reader DC. At the top of the invoice, you should see the message "Signed and all signatures are valid."
Select the signature to view a certificate stating signature validity.
Select Signature properties to view more details on signature validity.
Select Show signer's certificate to ensure that the certification paths are correct and that the certificate is trusted.
A digital copy is sent to the person who created the order in Partner Center. You can't get digitally signed invoices for any invoices that were issued before July 17, 2020. Also, manually signed invoices aren't available.
File a tax exemption
Before filing a tax exemption, make sure you understand the following points:
You must file a tax exemption for each CSP tenant.
You must submit either your tax ID number or Federal Employer Identification Number (FEIN). This number usually appears on your tax certificate. To learn more about updating VAT or your tax ID number, see Understand taxes and credits.
Depending on your location, your sales tax exemption has legal guidelines specific to the local Department of Tax Revenue (or similar department) and must be managed accordingly. While many locations have blanket tax certificates that are renewed annually, some locations may renew at two or more years. Verify this and other information by checking your certificate or contacting your local tax authority.
When you're ready to file your tax exemption, request support through Partner Center and supply the appropriate information.
What is the Modern Limited Risk Distributor (LRD) model?
An LRD (Limited Risk Distributor) is a subsidiary that Microsoft established as buy-sell distributor who sells directly or indirectly. This model will affect partners buying directly from Microsoft through the Microsoft Partner Agreement (MPA) and further demonstrate the Microsoft commitment to our business in the following countries/regions:
- Australia, New Zealand, and Canada.
- France, United Kingdom, Germany, Austria, Belgium, Denmark, Finland, Italy, Netherlands, Norway, Sweden, and Switzerland.
- Spain, Brazil, India.
Under the LRD model:
- The selling entity is the local LRD subsidiary (sales and distribution rights have been extended to the LRDs).
- The payment methods won't change for CSP Partners.
- The LRD can only sell to customers and partners located in the LRD country/region and agreed territories as defined by Tax.
- For LRD sales, the Licensor is either MS Corp or MIOL.
- For Americas the Licensor is MS Corp (1010).
- For EMEA and APAC the Licensor is MIOL (1062).
For partners not part of the LRD model and for legacy/ regular invoices, the billing entity is:
- For EMEA, the billing entity is Microsoft Ireland Operations Limited (MIOL).
- For Americas, the billing entity is Microsoft Corporation.
- For APAC, the billing entity is Microsoft Regional Sales Pte LTD.
- For Japan, the billing entity is Microsoft Japan Co., LTD.
- For Korea, the billing entity is Microsoft Korea Inc.
We have received guidance that due to decimal point rounding, some LRD invoices may show under or overcharging of Tax in comparison to the amount that should have been calculated based on the local tax regulation. While we work to resolve this issue, you are only required to pay the VAT amount calculated at the sub-total level of the invoice. Microsoft will be reporting the same amount in its VAT return and will write off the difference for any overcharges. Microsoft is bearing the risk of the undercharged VAT in case of audits. Unfortunately, at the moment it is impossible for Microsoft to reissue an amended invoice due to a system limitation.
Additional resources can be found in the Operations Readiness Gallery (requires authentication). A FAQ document is also available: Update to New Commerce Cloud Solution Provider Program Billing Model – FAQ.
For questions about tax exemptions, refunds, or other tax-related questions, request support through Partner Center. Allow two weeks for Microsoft to contact you and resolve the issue.