Tax rates, classes, & rules

In this article, you will find out how to set up and manage tax rules for your Shopgate mobile shop. For specific rules for Germany, please read Steuern einrichten.

 

Get started

Understand tax rules

Taxes in your Shopgate mobile shop are controlled by "Tax rules". There are 3 important variables that define a tax rule:

  Description Example
Tax Rate A number in percentage, with which taxes are calculated. 8.25% for the sales tax of California
Product Tax Class An identifier that is assigned to a product. This defines the tax class for a product. "Taxable", "Tax-free"
Customer Tax Class An identifier that is assigned to a customer. This defines the tax class for a customer. "Retail", "Wholesale"

When we have all of the 3 variables above, we can define a tax rule which makes actions happen.

Tax Rule           =            An established logic for {Tax Rate, Product Tax Class, Customer tax Class}

 

Check your shop system

If you use one of the following shopping cart systems, your tax rates, tax classes, and tax rules can be imported from your desktop shop automatically.

Magento PrestaShop Shopware 3.5+4 Plentymarkets GambioGX
xt:Commerce 3+4 Shopify Oxid Modified eCommerce OsCommerce
 3dCart  Open Cart  Zencart  WooCommerce  
After all the tax settings have been imported, please make sure to verify if all settings have been imported correctly.

 

If your shop system is not listed above, and your tax information is not imported after a product import, please configure your taxes manually.

 

Configure tax rules manually

Follow the steps below to go to your tax configuration page.

  1. Log in to your Shopgate Admin and navigate to Settings → Taxes.
  2. The Taxes page will open. We will explore how to add tax rates, product tax classes, customer tax classes, and configure tax rules below.

Tax rates

To create a tax rate, follow the easy steps here. Repeat the steps until you have created all tax rates necessary.

  1. Click "+Add" on the "Tax rates" section.
  2. A pop-up (shown right) will open. Configure it to match the tax rate in your shop.
  3. Click Save.

This table will help you understand the options shown above:

Name Please enter a tax rate name to assign to a tax rate. Make sure to use the same name as configured in your desktop shop. This name will be used to configure tax rules and is not visible to your customers.
Tax (%) The actual tax rate in %. For example, enter 8.25 for a rate of 8.25%.
Display name Tax rate name displayed on your Shopgate Admin page. This name is not visible to your customers.
Country

Select a country in which this tax rate will apply. More options may show according to the country selected.

Note that you can only select countries that your shop delivers to. To add a country, please go to your Shipping page and select it from the delivery countries.

State This option can be different according to the country selected. When the United States is selected, you will be asked to select a State for this tax rate.
Zip code Choose all, pattern, or range from the list. How to configure zip codes in a pattern or a range?

 

Product tax classes

To create a product tax class, follow the easy steps here. Repeat the steps until you have created all product tax classes necessary.

  1. Click "+Add" on the "Product tax classes" section.
  2. A pop-up (shown right) will open. Enter a name it to match the product tax class in your shop.
  3. Click Save.

This table will help you understand the options shown above:

Name Please enter a product tax name to assign to a product. Make sure to use the same name as configured in your desktop shop. This name will be used to configure tax rules. Where can I see a product's tax class?

 

Customer tax classes

To create a customer tax class, follow the easy steps here. Repeat the steps until you have created all customer tax classes necessary.

  1. Click "+Add" on the "Customer tax classes" section.
  2. A pop-up (shown below) will open. Enter a name it to match the customer tax class in your shop.
  3. Click Save.

This table will help you understand the options shown above:

Name

Please enter a customer tax name to assign to a customer. Make sure to use the same name as configured in your desktop shop. This name will be used to configure tax rules.

Note that a customer tax class will only work if your shop system supports this feature. If not, you only need to define one customer tax class (e.g. Retail).

 

Tax rules

After you have entered all tax rates, product tax classes, and customer tax classes for your shop, please follow the steps here to configure a tax rule. Repeat the steps until you have created all tax rules necessary.

  1. Click "+Add" on the "Tax rules" section.
  2. A pop-up (shown below) will open. Configure it to match the tax rule in your shop.
  3. Click Save.

This table will help you understand the options shown above:

Name Please enter a name for the tax rule. Make sure to use the same name as configured in your desktop shop. This is not visible to your customers.
Priority Enter an integer number here, for example, 0. The lowest number represents the highest priority and vice versa. How is tax calculated if multiple tax rules apply?
Product tax class Select one or more product tax class(es) for this tax rule.
Customer tax class

Select one or more customer tax class(es) for this tax rule, if applicable.

Tax rate Select one ore more tax rate(s) for this tax rule.

 

Set tax rule on shipping costs

If you don't charge additional taxes on top of the shipping costs you configured in the Shopgate backend, please read this chapter to set a tax-free rule on shipping costs.

Create tax rate for shipping

Create a tax rate according to chapter 2.1.

  • Enter 0 as your tax rate
  • Select all states in the US

 

Create product class for shipping

Create a product tax class according to chapter 2.2.

  • Use a unique name such as "Tax-free".

 

Configure tax rule for shipping

Create a tax rule according to chapter 2.4.

  • Set the same priority as the normal rules
  • Select the tax rate created in chapter 3.1.
  • Select the product tax class created in chapter 3.2.

 

Verify your tax settings

After your tax settings have been imported or manually created, please make sure that the rates and rules are configured exactly the same as in your desktop shop backend.

To test your tax rules on products and shipping, go to your mobile website or apps:

  • Test if taxes are added correctly to the products.
    Put a few products in the cart, enter all necessary data, and go to the checkout page. See if taxes are calculated to the same amount as in your desktop shop.
  • Test if taxes of each state/country are calculated correctly.
    Put a product in the cart, and try to change the delivery address to a different state or country.
  • Test if shipping costs are taxed correctly.
    Verify that the taxed amount is correct for different shipping costs.

That's it! If you have followed the chapters above, and your tax settings are verified, you have now successfully set up your tax rules for your Shopgate mobile shop.

 

Frequently Asked Questions

How to configure zip codes in a pattern or a range?

To configure a series of zip codes in a pattern, use the Wild-card * to substitute single or multiple numbers, characters, spaces, etc. For example, "12*54D" stands for all zip codes that begin with "12" and end with "54D". These also include "1254D" (nothing in between) and "12 54D" (a space in between).

To configure a series of zip codes in a range, enter the start and end zip codes in integers. For example, enter 35810 and 35819 to include all zip codes between "35810" and "35819".

 

Where can I find a product's tax class?

On your Shopgate Admin page, find a product's detail page. The product's tax class will be displayed like this:

 

How is tax calculated if multiple tax rules apply?

If multiple tax rules apply to one product, taxes are calculated based on the priority of each rule.

This happens in 2 steps:

  1. First of all, if two or more tax rules have the same priority, the tax rate of this priority is the sum of all tax rates of the same priority.
  2. Secondly, rates of all priorities will be multiplied. The result will be the tax on this product.

For example, all following tax rules apply to one product:

  • Tax rule 1: rate = 20%, priority = 0
  • Tax rule 2: rate = 5%, priority = 1
  • Tax rule 3: rate = 8%, priority = 1
  • Tax rule 4: rate = 12%, priority = 2

Tax rates will be calculated in 2 steps:

  1. Tax rate (priority 1) = 5% + 8% = 13%
  2. Tax rate (of this product) = Tax rate (priority 0) x Tax rate (priority 1) x Tax rate (priority 2) = 20% x 13% x 12% = 0.312%

 

Was this article helpful?
0 out of 0 found this helpful