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Why don't product prices include taxes on the Dawn theme?

COMBATICAUK
Excursionist
22 0 3

Hi

For some reason, the taxes are only being added at the cart otherwise it shows the price excluding VAT. I've followed all the instructions in this link https://help.shopify.com/en/manual/taxes

However, nothing works. Does anyone know a solution? I'm using the Dawn theme.

Accepted Solution (1)
Rostislav
Shopify Partner
190 12 29

This is an accepted solution.

As i said  - you need to change the product prices in your catalog. you can do it also by revorking your csv file - it takes just a few minutes.  Multiply you base prices by 1.2 in your catalog and leave tax ruales " include tax in prices" enabled , you will have prices with VAT included on all steps : storefront, cart and checkout  

www.easproject.com - the best EU and UK VAT compliance solution.

View solution in original post

Replies 13 (13)

Rostislav
Shopify Partner
190 12 29

 

Hi , 

Ensure that "Include tax inpices " option  is checked.  

 

Rostislav_1-1671314262256.png

 

And that all you products are set as taxble. 

Rostislav_0-1671314644783.png

 

 

That way prices in you storefront  will be shown VAT inclusive.

hope it helps   

www.easproject.com - the best EU and UK VAT compliance solution.
COMBATICAUK
Excursionist
22 0 3

I already have include tax in price checked but it makes no difference. And all products are set as taxable but the tax only shows at checkout, not on the product page.

Rostislav
Shopify Partner
190 12 29

Can you post some pictures , please?  From the chcekout, the product page and store front. 

www.easproject.com - the best EU and UK VAT compliance solution.
COMBATICAUK
Excursionist
22 0 3

COMBATICAUK_1-1671367596005.png

For example, this last order is showing the prices, plus the shipping, plus taxes but the total is without taxes so im having to pay it out of my own pocket.

Rostislav
Shopify Partner
190 12 29

All calculations are done properly and in accordance with Shopify rules. Remember that you use inclusive VAt rules :  

74,14+17.99=92,13 (VAT inclusive)/120*20=15.36 -VAT that is included in the price.

So your selling price (net of VAT)  is 92.13-15.36 = 76.77  and this is what your accounting takes in as your sales revenue.  

 

You have to keep prices in you catalague as VAT inclusive (i.e. add 20 per cent to them) and then everyting will be OK.

Technically "include tax in prices" button tells shopify that you have entered prices in your catalogue with VAT so it changes the logic of the calcaulation. You can see in the store front and the cart that all prices are VAT inclusive.  

 

 

www.easproject.com - the best EU and UK VAT compliance solution.
COMBATICAUK
Excursionist
22 0 3

My products are imported from a csv file which has the prices excluding VAT. If I uncheck 'VAT is included in price' then it automatically adds the VAT at checkout. However, I want it to auto add the VAT at the product page. Is this possible?

The above screenshot I shared is after I checked the VAT included in price like you said.

Rostislav
Shopify Partner
190 12 29

This is an accepted solution.

As i said  - you need to change the product prices in your catalog. you can do it also by revorking your csv file - it takes just a few minutes.  Multiply you base prices by 1.2 in your catalog and leave tax ruales " include tax in prices" enabled , you will have prices with VAT included on all steps : storefront, cart and checkout  

www.easproject.com - the best EU and UK VAT compliance solution.
reneevanwinkle1
New Member
4 0 0

Hi there!  In trying to resolve my problem I found your posts.  I am having a problem with VAT inclusive pricing as well but not exactly like the problem you were helping with here.  My problem is that I have my prices already calculated with VAT included.  I have the "charge sales tax" box checked in the product and also have the box in the admin checked "include sales tax in price" but now Shopify is adding VAT to my price in the product record so instead of seeing 275 pounds the customer is seeing 330 pounds which is incorrect.  275 includes the VAT but Shopify is adding onto the 275 and displaying the product on the product page with the 330, in the cart and at checkout.  Any ideas here?  Thank you!

Rostislav
Shopify Partner
190 12 29

Hi Renee,

The only conceivable reason is that the default country of you shop is not taxable in "taxes and duties " setting section. 

As soon as you switch the option " Include or exclude taxes based on your customer's location" the rules that are used by shopify change and the taxation status of your default country becomes important. 

The rule (for inclusive pricing ) for 3rd countries  goes like that  

Displayed price = catalog price - default country tax + destination country tax.

If your default country is not taxable then nothing is deducted and only destination tax added 

Example .

Your store in the UK , UK is not taxable , catalog price is 120 GBP , "Include or exclude tax based on your  cuatomer's  country" option  is enabled

 

Price displayed for Finland 

120 /1 (UK VAT is not deducted) *1.24 (Finnish tax added) = 148.8 

 

If you enable taxation for the UK , then the pricing goes :

 

120/1.2(UK tax deducted)*1,24 (Finnish tax added) = 124

 

Technically "Include tax in price" option defines how you enter the prices in the catalog  but it kicks in only IN CASE when the default country is taxable.

 

I hope it helps , if not  - let me know and we can have a look on the shop in a video call. 

www.easproject.com - the best EU and UK VAT compliance solution.
reneevanwinkle1
New Member
4 0 0

Hi there!  Thank you so much for your response.  I really appreciate it!  I am not sure this is it.  Our store is actually in the United States - address with Shopify is how I believe it determine where it is - correct?  This is a store we bought from the previous owner in the UK two years ago.  He was based in UK.  We are based in US but 95% of our customers are in UK.  So, when we sell the UK we must include VAT in price of product.  For example, one of our bags on our site is 275 pounds.  I need that to include the VAT.  I have set the price in Shopify at 275.  I have checkmarked to "charge tax on this product" and I also have the setting selected that I am collecting VAT and I also have the setting checkmarked to "include taxes in price" in the Shopify Admin area.  According to Shopify with the way I have it set up the customers should be seeing the product at 275 on the website and in their cart.  And then at checkout should see a line item which shows how much of the 275 is VAT.  When I am testing this I am in the US, but I choose GBP as currency and I also select an address in the UK to ship to as that should (I assume) kick in the VAT, etc.  Does all this make sense?  Maybe we can schedule video call so I can show you if this is too confusing.  Can you let me know how we could set that up?  My email is reneevanwinkle@gmail.com if you want to message me there so we can discuss the video call, pricing, etc.  Thank you!!

reneevanwinkle1
New Member
4 0 0

And I forgot to mention that instead of seeing the 275 I am seeing 330 on the website, in the cart and then at checkout I do see that 55 pounds of it is VAT which is good but I want the price WITH the VAT to be 275 and then show what amount is VAT *within* the 275 - does this make sense?  Oh, and the third party warehouse we use is located in the UK so it ships locally.  Not sure if that matters but thought I would mention it.  Thank you!

Rostislav
Shopify Partner
190 12 29

Hi, 

Let me have your e-mail, we can schedule a short video meet - there are a few settings that influence the situation and it is best if I see how it is set in your shop. Even the legal address of the shop (US or UK ) may influence the way how UK VAT is calculated/shown.

www.easproject.com - the best EU and UK VAT compliance solution.
reneevanwinkle1
New Member
4 0 0

Hi there!  Thank you!  My email is reneevanwinkle@gmail.com.  Thank you again!


Renee