VAT charging system

The webshop of Exponential charges value added tax (VAT) through VAT types: a name and a fixed percentage, such as "Standard, 19%". Every product (an object with a Price or Multi-price attribute) has a VAT type. There must always be at least one VAT type; a shop that charges no VAT keeps one at 0%.

VAT types are managed under Store > VAT types (/shop/vattype); see Managing VAT types.

Price including or excluding VAT

Each product, and each product class as its default, says how its price was entered:

• Price inc. VAT: the price entered already includes VAT. The customer pays the price as entered; the VAT is the part of it the percentage gives.
• Price ex. VAT: the price entered is without VAT. The customer pays the price plus the VAT: 500 at 25% becomes 625.

The dynamic VAT type

Besides the fixed VAT types there can be one dynamic VAT type, shown in the VAT type list of products as Determined by VAT charging rules (shop.ini [VATSettings] DynamicVatTypeName). A product with the dynamic VAT type has no fixed percentage: a VAT handler decides it when the product is shown or bought, for example by the customer's country and the product's category.

The dynamic VAT type exists only while a VAT handler is configured. Without one it is not offered and cannot be used. It works only with Price ex. VAT.

# settings/override/shop.ini.append.php
[VATSettings]
# the built-in handler: country and product category dependent VAT
Handler=ezdefault

Only one VAT handler can be used at a time. The built-in handler, ezdefault (ezdefaultvathandler.php in kernel/classes/vathandlers/), applies the VAT rules of Store > VAT rules; a handler of your own can apply any logic (see Creating new VAT handlers).

Three approaches

• VAT per product: a fixed VAT type per product. No handler needed.
• Country dependent VAT: the built-in handler with VAT rules by customer country and product category.
• Extended VAT: a VAT handler of your own.

Three approaches to VAT charging describes each with examples.

The pages of this section

• VAT settings: shop.ini [VATSettings].
• Managing VAT types, Managing VAT rules, Managing product categories.
• Assigning VAT types to products, Product category, User country.
• Displaying VATs on the actual site.

Every change to VAT types and rules is recorded in the audit trail as commerce.vat.change (see Audit trailing).