Note: When selling products online, please consult with a tax lawyer and/or accountant to make sure your business adhere to local regulations and collects the required taxes.
In Simple Store, how do I set taxes as "Tax Included"?
In some jurisdictions, you may need to set a tax rate but need to indicate that the tax is already included in the listed price of an item. In this case, the tax rate will not be added to the total price that the customer must pay. Instead, it is simply indicated as "included" in the price.
You can set this using the Tax Calculation setting. By default, this is set to "Taxes are added," which means any tax rate you set will be added to the order price before payment.
Instead, you can set it to "Taxes are included," which means any tax rate you set will not be added to the order price. Instead, the tax rate will merely be indicated as "tax included."
Can I set different tax rates for different regions?
Yes, if you select "US State" tax mode or "European VAT" tax mode, you can set a different tax rate for certain regions.
How is the tax calculated based on these settings?
For example, assume a product has a price of €10.00, with no shipping fee. Assume the tax rate for Germany is 19%, and the tax rate for Switzerland is 7.7%. Now let's see what happens when a customer goes through checkout for this one item:
- If tax calculation is set to Tax Added:
- A customer shipping to Germany will pay a total of €11.90. The 19% tax (€1.90) is added to the order price.
- A customer shipping to Switzerland will pay a total of €10.77. The 7.7% tax (€0.77) is added to the order price.
- If tax calculation is set to Tax Included:
- A customer shipping to Germany will pay a total of €10.00. This price will be automatically calculated as €8.40 for the product and €1.60 for the tax (since €1.60 is 19% of €8.40.)
- A customer shipping to Switzerland will pay a total of €10.00. This price will be automatically calculated as €9.29 for the product and €0.71 for the tax (since €0.71 is 7.7% of €9.29.)
In both cases, the customer will see this clearly indicated at checkout.
When I export my orders, will I see how much tax is included?
Yes, when you export your orders as CSV (useful for external processing), there is a column to indicate if the tax value is "Tax Included" or not. There is a "Tax" column, which shows the tax value, and a "Tax Included" column, which is either TRUE or FALSE. If TRUE, that means the tax value was included in the price.
For more information about tax settings, please see the main article on tax settings.