In this tutorial we will review how to correctly configure the tax theme in WooCommerce, in our case the different types of VATs.
General tax settings in WooCommerce
Obviously, the first thing we have to do is activate the tax option, which we find in the “WooCommece / Settings / Tax” menu. Next, we click on the “Enable taxes and tax calculations” option, as we can see in the image above, and we are ready to start.
As we can see, there are two options. Enter the prices of the products with or without VAT. That goes down to personal preferences. If you enter the price without VAT because it works better for you, or because you are directly importing the products from a file in which the prices are without VAT, then perfect. And if you enter them manually, you will surely prefer to place them with VAT, as this is what physical stores usually do on price tags.
Next we must choose if the VAT calculation should be calculated based on the country where we have the store (us)or depending on the customer’s address, whether shipping or billing (from order).
In this case, the safest thing is that you select the option “Customer order address”, since European regulations say that we have to charge the VAT corresponding to the buyer’s country.
Then we must establish if we want to establish a specific type of tax for shipping costs, or if we want to put the same tax on the products in the basket.
By default there is the option marked “Shipping tax class based on product basket” and it is the one that you probably want to leave, since it will be applicable in the same way to the end customer. But if you want you can directly establish a type, such as “Standard” or any of those that we establish later.
The next option allows us to round the decimals of the taxes at the subtotal level, instead of doing it on each product.
So, instead of rounding and adding at the end, first add and round to the end of everything, which is always more exact, since it keeps all the VAT decimals until the final calculation.
The following text box allows us to add various types of VAT. It is true that in many cases we will have enough with the “Standard” class that comes by default, but in some cases we will have other taxes or reduced versions of it. For example, for certain items the VAT is 4% or 10% instead of 21%. Well, we can put them like this:
As you can see in the image, we just have to put the title and that’s it. One per line. No more. Once we do that and save, a section will appear in the top menu to configure each of these taxes:
Later we will see how to configure these sections, but for now let’s continue with the general options, so as not to lose the thread.
Show prices with VAT and without VAT in WooCommerce
The following two drop-downs allow us to choose how to display the prices of the products. With VAT, or without VAT:
The first option refers to the prices that are in the store itself, that is, on the product listing page and on the individual product pages. This is closely related to the following option, which allows us to add a suffix to the price, so that the customer knows if that product has VAT included or not:
In this way, if for example we want to show the prices without VAT, we will mark the option “Excluding tax” (or Tax Excluding)with the suffix “VAT not included”, and it will look like this in the store:
But if we want to show the prices already with VAT, we will simply mark the option “Including tax” or “Tax included” and in the suffix we will write “VAT included”, and WooCommerce will show it automatically, regardless of whether we have entered the price with or without VAT:
As for the second dropdown, it refers to how we want to display the taxes on the cart and order page. If we show it with VAT included, it will look like this:
As you can see, the price already includes 21% VAT. On the other hand, if we show it without VAT in the prices, we will see it like this:
In this case, we can see how the price does not include VAT, but that we have it separately in another line called VAT, with an amount of €21.
And the last option is the one that allows us to choose to show detailed VAT by type, or as a single total.
Well, with this we settle the general settings. Now let’s return to the subject of the types of VATs or taxes that we have established.
Additional tax classes in WooCommerce
As I have indicated previously, in the case that we have only one type of tax (the typical general VAT of 21%)we will only see this:
But if we have introduced other classes of VAT, such as reduced VAT, luxury products, or any other of them, we can see them right next to it:
The operation of what we are going to tell now is the same for all the classes, that is, we only have to select any one, to see the following configuration screen:
This screen allows us to establish various percentages depending on the country or regions. We must enter:
- Country code: The typical two-letter code, in the case of Spain “ES”. Here we have a list of all of them, in case you are interested.
- State code: The same, in the case that applies, of course.
- Postal code and city: In some cases there are certain regions that have a special VAT, such as Ceuta and Melilla. Here we can set it.
- Rate: The percentage, in our case 21%
- Priority: This will only apply if we have several types of taxes, to establish which one must be added first.
- Compound: If it is a tax that must be applied on top of the other taxes, check here. In our case it does not apply.
- Shipment: Here we indicate if this tax should also be applied to the shipping method.
This is exactly what we will find in the rest of the tax classes, as you can see in the following screenshot, in the case of reduced VAT of 4%.
And once we have this done, that’s it. We have already configured everything conveniently. Now when we add a product, by default it already appears with the tax situation “Taxable” and the tax class “Standard”:
The three tax status options are:
- Taxable: Subject to VAT
- shipping only: Only the shipment of the product is subject to VAT
- None: Product not subject to VAT.
Regarding the “Tax class” drop-down, as many as we have created in the section analyzed before will appear, in this case, “Standard”, “4% VAT” and “10% VAT”. By default, the “Standard” class is marked, which is where we should normally put the 21% VAT.
Anyway, this is it, gentlemen. You already know how to correctly configure taxes and tax types in WooCommerce. If you have any questions, you already know that you can contact us through the “Support” tab of the .
And if you want to know more about WooCommerce, you have at your disposal the and the . Both are part of the . More than 6045 videos telling step by step how to do all this in real time. And new classes are added every day! If you are interested, you just have to. 🙂
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