Sunday, January 23rd, 2022

How to Set Taxes in WooCommerce

Running an online store offers many benefits, but figuring out taxes isn’t one of them. This task may seem a bit daunting, especially if you have never done it before. Luckily, WooCommerce provides a straightforward setup process to help you get the job done quickly and efficiently.

In this post, we will take a closer look at how WooCommerce tax works. We’ll also show you how to set them up. let’s get started!

What you need to know about WooCommerce taxes

When you sell products or services online, you must include taxes in your product pricing and shipping costs. If you have a WooCommerce store, you don’t need to use additional tools for this process. This is because this popular e-commerce platform comes with a slew of features and settings to help you get started.

WooCommerce enables you to calculate and set up your taxes based on the laws and regulations of the country where your business is registered. However, you may still want to seek professional advice from an accountant or legal expert. This can help ensure you are using accurate tax rates and that your store complies with local tax regulations.

How to Set Up Taxes in WooCommerce (in 4 Steps)

As we mentioned, WooCommerce makes it very easy to set up taxes for your store. However, you may feel a little overwhelmed by the various options and settings available to you. In this tutorial, we will walk you through the complete process of setting up tax in WooCommerce.

Step 1: Enable WooCommerce Tax

To get started, you’ll need to enable taxes for your store. Navigate to your WordPress Dashboard Woocommerce > Adjustment. Make sure that Mango Tab is selected, see more enable tax the option:

Check the box next to it, and then click save Changes Button. This will create a new tab for taxes in your WooCommerce settings.

Step 2: Configure your tax settings

Now you can start configuring your tax options by going to the newly created do Tab in WooCommerce Settings:

Tax Options Page in WooCommerce

First, you need to decide whether you want to include tax in product prices. If you choose the latter option, taxes will be calculated and added to each user’s bill during checkout.

Next, you can choose the location at which you want to calculate the tax. Click the drop-down menu and select one of the following options: customer shipping addresshandjob customer base address, Or shop address. If you choose the third option, taxes will be based on the location of your store.

You also need to set the shipping class. Once again, you get a few options to choose from:

shipping tax class option

By default, the shipping tax class is based on the item in the user’s cart. For example, if a user purchases an item that falls under a different tax rate, shipping tax will be calculated at the same rate. If this is not allowed in your tax jurisdiction, you can choose a different tax class.

You can also enable tax rounding at the subtotal level instead of per line:

Tax rounding and tax class options

WooCommerce also enables you to create new tax classes. other than default standard rate, You get two additional options: reduced rate And zero rate. To add another class, simply enter a name in the field (one class per line). Later, we’ll show you how to fully set up additional tax rates in WooCommerce.

Next, you can choose whether the tax will be included in the product prices displayed on the front end of your store. You can also configure similar settings for prices displayed in cart and during checkout:

Display price option in WooCommerce tax settings

Additionally, you can customize the text that will be displayed along with the prices of your product. This lets users know whether the price includes tax or not. WooCommerce provides two placeholders for this purpose: {price_incl_tax} And {price_except_tax}.

In the end, you’ll see display tax totals the option. This lets you choose whether you want multiple taxes to be displayed as a single total during checkout, or as a single itemized list.

this much only! We’ve covered all the tax options available with WooCommerce. When you are happy with your settings, click save Changes button at the bottom of the page.

Step 3: Set Tax Rates

Earlier, we mentioned that WooCommerce comes with three types of tax classes: standard rate, low rate, and zero rate. We also showed you how to add a new tax class. Now, let’s look at how to set up tax rates for your store.

In your tax settings, click the tax category you want to configure. For this tutorial, we will be working with standard rates:

Setting Rates for WooCommerce Taxes

To add a new tax rate, click insert row the option. You will then be able to enter the relevant information in the available fields. Let’s look at the characteristics for each tax rate:

  • country code. Specify a 2-digit country code for the rate. You can use the ISO 3166-1 alpha-2 codes to see the official codes for each country. If you do not want to specify a particular country, you can leave this field blank.
  • State Code. Enter the 2-digit state code for the rate (where applicable). If you want the rate to apply to all states, you don’t need to enter a code.
  • Zip post code. Enter postcode for rate. You can separate each code with a semi-colon (;) and use wildcards and ranges (e.g. you can enter “50” to apply the rate to all ZIP codes that begin with those two digits). can).
  • City. Specify the city (or cities) where this tax rate is applicable.
  • Emotion. Enter the tax rate using four decimal places. For example, you would enter “30.000” for a tax rate of 30%.
  • Tax name. Enter a name for your tax rate, such as “Sales Tax” or “VAT.”
  • Preference. Select a priority for this tax rate. Note that you can use one match rate per priority. To define multiple tax rates for the same area, you must specify a different priority for each rate.
  • Compound. Check this box if you want the rate to be applied on top of all other taxes.
  • Shipping & Delivery. Select this option if the rate applies to shipping charges.

When you’re ready, click save Changes. Here’s an example of a tax setup for a WooCommerce store:

example of tax rates

You can also import or export tax rates by clicking on import csv Or export csv Button. If you want to remove the tax rate, just select the relevant row and click on Delete selected row(s).

Remember that you can set tax rates for your other tax classes as well: low rate and zero rate. All you need to do is select the tax category from the top of the page.

Step 4: View your tax report

Once you’ve set up your taxes, you can use the tax reporting feature in WooCommerce. go for Woocommerce > reports > taxes:

Tax Reports in WooCommerce

if you choose tax by dateWith this, you can view your tax reports based on the time period you have chosen. In the meantime, if you choose tax by code, you will have access to data for each tax rate in your store.

Conclusion

Setting up taxes for your online store can be a daunting task. Fortunately, WooCommerce enables you to configure your tax rates and calculations in just a few clicks.

In this post, we showed you how to set up tax in WooCommerce in four easy steps:

  1. Enables tax rates and tax calculations from your WooCommerce settings.
  2. Configure some basic settings, such as shipping tax classes and tax rounding.
  3. Set tax rates based on different countries and states.
  4. View your tax report.

Do you have any questions about setting up taxes in WooCommerce? Let us know in the comments section below!

Featured Image via VectorHot / Shutterstock.com

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