cancel
Showing results for 
Search instead for 
Did you mean: 

New EU VAT/TAX configuration

New EU VAT/TAX configuration

Hi,

from july 2021, each EU country that sells to other EU countries, should include destination country VAT in their invoices. For example, in Spain we have 21% VAT and in Germany, 19% VAT. If I send a product from Spain to Germany, the invoice should show 19% VAT.

I tried to configure tax rules and Magento works like that:

 

- It checks the destination country from the logged user.

- It deducts the VAT from the sending country and then adds the VAT from the destination country.

 

The main problem, is that the product price including taxes is different depending on where the customer is from. And that's a problem if your suppliers ask you to have allways the same SRP shown on the weppage.

 

For example, if the SRP is 200€, the price shown for a german customer would be:

 

200€ - 21% = 165,289€ -> adding 19% german VAT = 196,69€

 

What I want to achieve is that inside the EU, all customers pay the same, but on their invoices, the VAT show different amounts.

 

Is that possible?

 

Thank you very much!!!!

 

Do you know a way to solve it?

 

Thank you very much!!!

4 REPLIES 4

Re: New EU VAT/TAX configuration

Hi there! It's definitely challenging to navigate the new EU VAT rules.

Re: New EU VAT/TAX configuration

Have you tried using a VAT calculator to help you determine the correct amounts for each invoice? As for your question, I'm not sure if it's possible to have all EU customers pay the same price while showing different VAT amounts on their invoices. Perhaps there's a workaround or a specific configuration in Magento that can help with that. Have you reached out to Magento support or community for assistance?

Re: New EU VAT/TAX configuration

Configuring EU VAT/TAX involves several steps, including:

Verify VAT registration: Verify your VAT registration with your national tax authority to ensure that your business is registered for VAT and has a valid VAT identification number (VATIN).

Determine the VAT rates: Determine the applicable VAT rates for the products or services you sell. EU VAT rates vary by country and can be as high as 27% in some member states.

Apply VAT rates: Apply the appropriate VAT rate to your products or services, and make sure that your invoices clearly state the VAT rate and amount charged.

Implement VAT compliance measures: Implement the necessary compliance measures, including collecting and remitting VAT, maintaining proper records, and submitting VAT returns on time.

Use VAT MOSS: If you sell digital products or services to customers in other EU countries, consider using the VAT Mini One-Stop Shop (VAT MOSS) to simplify your VAT compliance obligations.

Get professional advice: If you are unsure about how to comply with EU VAT regulations, seek professional advice from a tax expert or accountant.

 

Regards,

Rachel Gomez

Re: New EU VAT/TAX configuration

To achieve consistent pricing for EU customers while displaying destination country-specific VAT on invoices, you may need a custom solution. Consider working with a Magento developer to modify the tax calculation process. Ensure that product prices remain the same for all EU customers while adjusting VAT on invoices based on the destination country. This way, the displayed product price remains constant, meeting your suppliers' requirements, and VAT reflects the appropriate rates for each destination.