Tax done right?

[Cassim]

Hey all.

 

So here comes the big question. 
We are planing to... move into EU. But we have one big issue. 

We have a WSP that are fixed. So no matter where you live in EU or other, the pay price is fixed. This is even regardless of the VAT/TAX rate. So taking a show here

Item 1 fixed sales price 19,99€:

How the system needs to work. 

• Customer from Denmark :
  RSP : 19,99 € (fixed) 
  TAX (25%): 3,99€  
  RSP without TAX : 15,99
• Customer from Cyprus : 
  RSP 19,99 €
  TAX (19%) : 3,19€
  RSP without TAX : 16,8€

So no matter what i do, my TB is doing it wrong, as its doing this : 

• Customer from Denmark :
  RSP : 19,99 € (fixed) 
  TAX (25%): 3,99€  
  RSP without TAX : 15,99€
• Customer from Cyprus : 
  RSP 18,92 €
  TAX (19%) : 3,02€
  RSP without TAX : 15,99€

 

So how do i get my vat to work in the right way.?

So that if i change country & vat-rate, the price will stay the same, but just the tax amount will change.? 

Will that be a custom coding part, or is their a setting or something to do this?  

[Traumflug]

Yes, price without tax is the fixed price. Which means, a different tax rate gives a different customer price.

That said, in EU legislation VAT gets always paid in the home country. If your shop is in Danmark, you always pay tax in Danmark, even when shipping to Cyprus. When shipping to outside the EU (U.S., Switzerland), you pay no tax at all (but customers have to pay import tax at their customs office). All this to my understanding how current tax legislation in the EU works, it's no authoritative legal advice.

[haylau]

1 hour ago, Traumflug said:

Yes, price without tax is the fixed price. Which means, a different tax rate gives a different customer price.

That said, in EU legislation VAT gets always paid in the home country. If your shop is in Danmark, you always pay tax in Danmark, even when shipping to Cyprus. When shipping to outside the EU (U.S., Switzerland), you pay no tax at all (but customers have to pay import tax at their customs office). All this to my understanding how current tax legislation in the EU works, it's no authoritative legal advice.

And inter EU VAT is also awkward

So if you are in Danmark and your customer is in Cyprus with a valid VAT number then they should not pay tax (obviously they can only have a vat number if they are a business)

[datakick]

 

2 hours ago, Traumflug said:

That said, in EU legislation VAT gets always paid in the home country. If your shop is in Danmark, you always pay tax in Danmark, even when shipping to Cyprus.

Not always. For example, when selling Electronically supplied services (for example selling ebooks, or software licenses), merchant must use customer's country VAT tax rate. Merchant must collect VAT, and either register and pay VAT in each and every EU country, or use MOSS scheme. 

[haylau]

27 minutes ago, datakick said:

 

Not always. For example, when selling Electronically supplied services (for example selling ebooks, or software licenses), merchant must use customer's country VAT tax rate. Merchant must collect VAT, and either register and pay VAT in each and every EU country, or use MOSS scheme. 

Yep, forgot that bit. Tax is soooo complex. They should do away with all tax - HAHAHA

[Cassim]

So I know what vat/tax is.

thats not the question.

the question is how to do it right.

how to get tb show the right price.

 

As it is now if I set a price to 10€ it will go down to 9,5€ in Cyprus, as the tax is not taken from the buy price, but it’s added to some other product.

so how to do it so that no matter what it always cost 10€ no matter of the Vat?

[datakick]

Are you selling virtual products? Because if not, you shoud have the same vat rate regardless of destination country - for regular products, your country tax rate should apply.

If you are selling virtual products, then the only way to have the same final price is by using Specific prices. A lot of work

[Cassim]

We are selling digital, that’s the problem 😭

So yeah lots of work to get it working right.

 

but no hot fix it sounds like ?

[datakick]

2 minutes ago, Cassim said:

but no hot fix it sounds like ?

It is working as it should, there's no need for any kind of fix. Neither hot nor cold 🙂

[Cassim]

It’s not working if we need a fixed sales price, and have the tax been removed form the sales price, not any other price

[datakick]

As I wrote before - for that you need to use Specific Prices. There you can assign different price for different countries, czrrencies, groups, etc.

It will be a lot of work to do. You should probably prepare some dataset in excel abd import it. Manual entry would be crazy

[Cassim]

Im not sure what you mean by that.

as I only need 1 price no matter country, vat or anything.

my prices are based on currency. And not based on vat or anything other. 
 

so how to set a fix price to show no matter what. ? 

 

[datakick]

54 minutes ago, Cassim said:

Im not sure what you mean by that.

as I only need 1 price no matter country, vat or anything.

my prices are based on currency. And not based on vat or anything other. 
 

so how to set a fix price to show no matter what. ? 

 

In thirtybees / prestashop, there is only one price stored inside database. It's called retail price, or base price:

Final price is calculated from this price. There are many factors that impact final price, such as tax, group discount, cart rules, specific prices, currency, etc.

I understand that you *want* to enter final price, but that just can't be done. Final price is always calculated.

So, if you want to always have the same final price, you need to use Specific prices -- you need to set specific / different base price for every EU country, so the final price will match. 

Or you can try to achieve this using cart rules, and apply (possibly negative) discount to customers from different countries.

 

 

[Cassim]

Is their a way to fix that so it use the store price that is used instead of the base price ? 

[zen]

it's seems like you want to do it on a totally different way it should work.... the normal way for accounting and legal will be to fix a retail price without VAT : the same for all customers, and depending on the vat of each customers country then calculate the final price.

Otherwize how are you gonna manage all this discounts you have to apply to make the accounting correct ? Are you using an ERP, wich one ?

Accounting need a fixed price for items.. you cannot change it per customer, it needs a voucher for each customer then, that will be tricky to do.

In how many countries are you willing to sell your digitals products ?

[musicmaster]

Wouldn't it be possible to get a discount by country? Assuming the data from the first post and assuming that 19% is the lowest rate you could set the price without VAT (lowest rate means highest price) at that level.

In that case you will need for all customers from Denmark for all products the same discount in percentage. I am a bit too lazy to calculate it now. It would be a bit over 5%.

 

[haylau]

Might or might not be relevant but in the EU is it not illegal to charge different prices based on nationality or country of residence? To me it is not clear whether that means same net price or same gross price. So, if we assume the same gross price then the OP has a point. He needs to set a gross price and the shop software needs to do the background calculations

Pleased we have physical products, so much easier (ahem)

[Briljander]

You can charge whatever price you want inside EU but the buyer can order from any destination or site within EU without any problems. 

Imagine every physical store would be forced to have the same price in all their stores inside EU.

[haylau]

https://europa.eu/youreurope/citizens/consumers/shopping/pricing-payments/index_en.htm

Price discrimination

As an EU national or resident you can't be charged a higher price when buying products or services in the EU just because of your nationality or country of residence.

 

It does allow for currency rates and different shipping costs, but the way I read it is the base cost of the product must be the same

[Cassim]

Im glad that so many do read what im writing. (or not), so i try again.

 

My sales prices are set by the publishers, that is how the system is working no matter what you say or the lay is, the price is the price, and i can set what i like of price. If its 19,99 i can sale it to 1€ if i like to. This is not the question, and i don't ask you to tell me the law. I know the law, so thats but no thanks. 

I just need to know how to do this, i don't need to know anything other then that. 

 

I have a product, lets call it Empire of Sin does cost 49,99€ and that price is fixed to the €, and it don't care about VAT, the price is fixed no matter what country to you in, if you black, white, pink, orange or anything. Thats not related. The sales price is 49,99€ for persons within the €-currency countrys. Just so that you understand it here are the prices. 

• € 49,99
• £ 34.99
• $ 39,99

This prices for the product are fixed, no matter what vat rate you have or not. You need to be charged with that amount. So if you live in US your using $ as currency and will be charged in $, if you live in UK you will be charged in £, and again this is 100% regardless of your vat rate or anything. 

Is their a way in TB to handle this without a external system to handle it for us.? 

So can TB do it like this : 

• Danish customer (25% vat) - Total order value 49,99€ incl vat. (Vat = 9,99€) 
• German customer (16% vat) Total ordre value 49,99€ incl vat. (Vat = 7,99€) 

So no matter the vat-rate, the customers will pay the same, but the vat will be calucated based on the total price. 

Does that give any meaning.? 

Can TB do that without any change? 

 

 

[zen]

20 minutes ago, Cassim said:

Im glad that so many do read what im writing. (or not), so i try again.

My sales prices are set by the publishers, that is how the system is working no matter what you say or the lay is, the price is the price, and i can set what i like of price. If its 19,99 i can sale it to 1€ if i like to. This is not the question, and i don't ask you to tell me the law. I know the law, so thats but no thanks. 

I just need to know how to do this, i don't need to know anything other then that.

I have a product, lets call it Empire of Sin does cost 49,99€ and that price is fixed to the €, and it don't care about VAT, the price is fixed no matter what country to you in, if you black, white, pink, orange or anything. Thats not related. The sales price is 49,99€ for persons within the €-currency countrys. Just so that you understand it here are the prices. 

• € 49,99
• £ 34.99
• $ 39,99

This prices for the product are fixed, no matter what vat rate you have or not. You need to be charged with that amount. So if you live in US your using $ as currency and will be charged in $, if you live in UK you will be charged in £, and again this is 100% regardless of your vat rate or anything. 

Is their a way in TB to handle this without a external system to handle it for us.? 

So can TB do it like this : 

• Danish customer (25% vat) - Total order value 49,99€ incl vat. (Vat = 9,99€) 
• German customer (16% vat) Total ordre value 49,99€ incl vat. (Vat = 7,99€) 

So no matter the vat-rate, the customers will pay the same, but the vat will be calucated based on the total price. 

Does that give any meaning.? 

Can TB do that without any change?

no TB can't do this and this is illegal to change the core price because of customer country.

"I have a product, lets call it Empire of Sin does cost 49,99€ and that price is fixed to the €, and it don't care about VAT, the price is fixed no matter what country to you in, if you black, white, pink, orange or anything. Thats not related."

the price without VAT will always be the same.. but when you sell it you have to add VAT.. and that one is different in EU countries, so you have to take that into account, if it were REAL products and not virtual or digital then you could do what you ask .. but not in this case you'll be doing illegal things and that will cost you a lot when regulations of your contries will look into your shop and your accounting.

Best Regards.

[datakick]

7 minutes ago, Cassim said:

So no matter the vat-rate, the customers will pay the same, but the vat will be calucated based on the total price. 

The answer to your question was provided many times already, you just don't want to acknowledge it.

The only way to have the same final price (for virtual products) is to create Specific Prices - you will need to enter different base price for every country in the EU. 

Something like this (if you wanted to have $100 final price):

 

Theres's no way to change semantics of the stored price. There are thousands of lines of code that *expect* this to be Price without TAX. Also, every module that exists expects the same semantics. This will never change, no matter how many times you ask.

If you really need this, then figure out how to import specific prices. Because maintain this manually would be... bold.

[haylau]

Simple answer is no. As that is not how value added taxes work, then I guess no off the shelf e-commerce solution will allow you to do that

Just a thought - have you talked to your accountant? Are you planning to be registered for VAT in all of those countries? If you are not registered for Tax purposed in those countries then VAT may not actually come into it at all?

Depends on turnover in each country (Of course Eu is a little different)

[zen]

Even with specific prices.. I am not sure it is legal to do that !

How are you gonna justify that you give reduction to poland about 10% and for Sweden only 5%...

It needs to be explained in the legal notices and rules of sales... and depending on your contry it just might be as illegal of changing core price... have to dig more deep in the law/rules of the country you sell from.

 

[datakick]

2 minutes ago, zen said:

Even with specific prices.. I am not sure it is legal to do that !

It's not legal, of course. But it's up to OP to decide if they want to break EU laws or not.

From technical point of view, Specific Prices are the only way to achieve what they want. Not the only one - they could also turn off taxes completely, and do the accounting stuff off-site.

[zen]

1 minute ago, datakick said:

It's not legal, of course. But it's up to OP to decide if they want to break EU laws or not.

From technical point of view, Specific Prices are the only way to achieve what they want. Not the only one - they could also turn off taxes completely, and do the accounting stuff off-site.

yes no tax is the way to go... then no more problems 🙂