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VAT / Tax Settings

Overview

VAT / Tax Settings configures tax calculation for your store. Set up Value Added Tax (VAT), sales tax, or GST to be applied to orders and displayed on invoices.

Accessing Tax Settings

Navigate to: Settings > VAT / Tax from the sidebar menu

Tax Settings

VAT / Tax Configuration

Enable Tax

  • Type: Toggle switch (On/Off)
  • Default: Off (disabled)
  • Purpose: Turn tax calculation on or off for all orders

When Enabled:

  • Tax is calculated on orders
  • Tax appears on invoices
  • Tax breakdown shown at checkout
  • Additional settings become visible

When Disabled:

  • No tax calculated
  • Prices are final prices
  • Simpler checkout display

Tax Settings (When Enabled)

These settings appear only when tax is enabled.

Tax Rate (%)

  • Type: Number input with percentage suffix
  • Default: 0.00%
  • Range: 0% to 100%
  • Step: 0.01 (allows decimals like 15.50%)
  • Purpose: Global VAT/tax percentage applied to all orders

Common Tax Rates by Region:

Region Common Rate
Saudi Arabia (VAT) 15%
UAE (VAT) 5%
UK (VAT) 20%
USA (varies by state) 5-10%
Canada (GST) 5%
Australia (GST) 10%
EU (varies) 17-27%

Price Display Mode

  • Type: Dropdown selection
  • Default: Exclusive
  • Purpose: Determine how prices are shown throughout the store

Options:

Mode Description
Exclusive Tax is added at checkout. Product prices show pre-tax amounts. "Price + Tax = Total"
Inclusive Prices already include tax. No additional tax added at checkout. Cleaner display.

Exclusive Example (15% tax):

Product Price: $100.00
Tax (15%):     +$15.00
Total:         $115.00

Inclusive Example (15% tax):

Product Price: $115.00 (includes $15 tax)
Total:         $115.00

Choosing Display Mode:

  • Exclusive: Common in B2B, USA, and when prices need to be comparable pre-tax
  • Inclusive: Common in consumer-facing European stores, simpler for customers

Tax Label

  • Type: Text input
  • Maximum Length: 50 characters
  • Default: VAT
  • Translatable: Yes
  • Purpose: Label shown on invoices and at checkout

Common Labels:

  • VAT - Value Added Tax (UK, EU, Middle East)
  • GST - Goods and Services Tax (Australia, Canada, India)
  • Sales Tax - United States
  • TVA - Taxe sur la Valeur Ajoutée (French)
  • MwSt - Mehrwertsteuer (German)

Where It Appears:

  • Checkout summary
  • Order confirmation
  • Invoice documents
  • Cart summary

Tax Information Note

When tax is enabled, an informational note is displayed:

Note: Tax settings will be applied to all new orders. Existing orders will retain their original tax calculations.

This means:

  • Changing tax rate doesn't affect past orders
  • Only new orders use new settings
  • Historical order integrity maintained

Tax Configuration Examples

Saudi Arabia VAT

Enable Tax: On
Tax Rate: 15%
Display Mode: Exclusive
Tax Label: VAT

UAE VAT

Enable Tax: On
Tax Rate: 5%
Display Mode: Inclusive
Tax Label: VAT

No Tax (Digital Products to Global Customers)

Enable Tax: Off

US Sales Tax (Example)

Enable Tax: On
Tax Rate: 8.25%
Display Mode: Exclusive
Tax Label: Sales Tax

Tax Calculation Details

Exclusive Tax Calculation

Subtotal: $100.00
Tax Rate: 15%
Tax Amount: $100.00 × 0.15 = $15.00
Total: $115.00

Inclusive Tax Calculation

When prices include tax, the system calculates the tax portion:

Price (including tax): $115.00
Tax Rate: 15%
Tax Portion: $115.00 ÷ 1.15 × 0.15 = $15.00
Pre-tax Amount: $100.00

Applied To

Tax is calculated on:

  • Product prices
  • Variants (if applicable)
  • May exclude or include shipping (based on configuration)

Compliance Considerations

Record Keeping

  • All tax calculations are stored with orders
  • Invoice includes tax breakdown
  • Reports show tax collected

Multiple Tax Rates

The current system supports a single global tax rate. If you need:

  • Different rates per product category
  • Different rates per region
  • Tax exemptions

Contact support for advanced tax configuration options.

Tax Registration

Ensure your business is properly registered for VAT/tax collection in your jurisdiction before enabling tax features.

Saving Changes

Click the Save button at the bottom of the page to apply your changes.

Important: Tax changes apply to new orders only. Existing orders retain their original tax calculations.