Taxes

How to Create Zone Taxes

One Zone Tax is one tax used in one Zone. It defines the tax that will be used for taxing items you offer in your online store. Zone Tax are not connected directly to items you sell, they are linked with Tax Rules, which define the final tax (according to a customer and item).

To create a Zone Tax you need to have particular Zones defined for which you want to define taxes. Zones are added in the Administration module.

To create a new Zone Tax run the Administration module. Double-click its icon located on the Desktop.

  1. Run the Zone Tax application.

  2. Click the New button.

  3. Fill in all required fields

    • The Name which is used only for your own purposes and it is never visible to customers.
    • The Abbreviation’s purpose is to identify the tax. Most taxes are an official abbreviation and it is a good strategy to use, because it willimprove clarity. This field can also be displayed to customers (for example on the invoice or checkout summary).
    • Zone field defines the Zone in which this tax will be used.d. Rate in % is the rate of the tax.

Define all taxes for all countries which are relevant to your online store. BizBox does not create tax rules as a default, you are responsible for the lawful taxation in all countries yourself. Now it’s time to create categories for taxation.

How to Create Product Tax Category

Product Tax Categories are grouping together Products which are grouped on the basis of a same taxation. You can sell various Products with different taxation on your online (according to the laws of particular Country/Region (Zone) in which you sell). Product Tax Category defines which taxation rule will be used for Products from this Category (this definition is set in the Tax Rules application).

In this application you are only defining the particular categories. Products are added into it in the Pricing module along with the price.

Complete following steps to create a Product Tax Category:

  1. Run the Administration module. Double-click its icon located on the Desktop.
  2. Run the Product Tax Categories application.
  3. Click the New button located in the tool bar.
  4. Fill in both required fields. They are only for your own and BizBox Admin purposes and are never visible to customers.
  5. We highly recommend you to fill in the description field because it can make your work in the future much easier.

Remember that created Categories have to be used in a Pricelist and Tax Rules. Otherwise they are not able to work properly. Products are added to it in the Pricing module along with the price.

How to Create Customer Tax Category

Customer Tax Categories are intended to distinguish particular groups of customers which pay different tax rates. VAT payers and non-payers are typical examples of the usage of a Customer Tax Category. In this application you define only the name of the group and the Zone in which this category will be used. The concrete tax rate is assigned in the Tax Rules application.

You are not selecting and adding customers to these categories manually. The customer them self selects the category he/she belongs to during the checkout process.

Remember that you have to connect these customer categories to a Taxation Rule which defines how the tax will be applied. Otherwise your customers will not be able to select and use it.

This tutorial follows the “How do I create Zone Taxes” tutorial and it is a part of the “Taxes and Charges tutorial”.

Complete the following steps in order to create a new Customer Tax Category:

  1. Run the Administration module. Double-click its icon located on the Desktop.
  2. Run the Customer Tax Categories application.
  3. Click the New button located in the tool bar.
  4. Fill in both required fields. The name of the field is intended only for your own and BizBox Admin purposes (it is never visible to your customers).
  5. The zone field defines the Zone in which this Customer Tax is active. In case you want to make it active for more Zones, you have to add it separately for each Zone. Zones also need to be previously defined in the Administration module (Countries and Region applications).
  6. Default in Zone” option is set to NO as default. In case you want to make this Category default, it will be assumed that all customers from this Zone belongs to this Category.
  7. We highly recommend you to fill in the description field because it can make your work in the future much easier.
  8. Click the Save button.
  9. Repeat the steps 3-8 until you have added all the Customer Tax Categories you want to use on your online store.

Remember that you have defined only Categories for customers. The Category itself doesn’t define a tax rate, it just unites objects (customers in this case) which will have the same tax rate. Now define the tax for these categories in the Tax Rules application.

Create a Tax Rule

Tax Rules are created in the Administration module in the Tax Rules application. Tax Rules are used to define a tax that will be applied to a particular Product or customer depending on the Zone and Branch.

To be able to create a Tax Rule you need to define some prerequisites first:

  • Zone Taxes which defines the tax itself (its name and rate). It is a real tax which is used in a concrete Zone and which you want to apply it in your online store.
  • Customer Tax Category defines groups of customers according to differences in taxes they pay.
  • Product Tax Category defines groups of Products according to differences in taxation. Some countries (Zones) have variable taxation rules for different Products.
  • Branch which will be responsible for orders from the connected Zone.

How do I create a Tax Rule?

Tax Rule defines how a tax will be applied. You connect a particular tax rate (created in Zone Taxes), customer taxation (created in Customer Tax Categories), product taxation (created in Product Tax Categories) and a Branch that is responsible for dispatching orders (Branches are created in the Administration module). These together create a Tax Rule.

This is the final part of the “Taxes and Charges” tutorial. Here you define the final rules which determine how the taxation will be applied according to the Zones, customers, and Products. Without Tax Rules, your online store will not be able to count tax prices at all.

There are some prerequisites required to complete this tutorial - a Customer Tax Category, a Product Tax Category, a Zone Tax and a Branch. You need them in order to define your own taxation rules. If you don’t have them, you can create them according to the tutorials listed below.

Tax Rules are connected to your online store through a Branch. You select a Branch as a part of Tax Rules setting and this Branch (when connected to an E-shop Setting) provides the set taxation.

Note

You have to connect the Branch, which is selected in Tax Rules, with an E-shop Setting. Otherwise the taxation cannot work properly.

Note

The Gross Price setting (in the Pricing module) is related to Tax Rules. The final price with or without taxation is counted according to these Taxation Rules (defined by Product Category).