Incorrect Tax Amount being added to the basket

Camembear1
New Member
1 0 0

Has anyone experienced any issue / explanation for why the VAT (UK) added doesn't match up to what it should be?

We have had an order come in for 4 items / requesting and invoice / and I can't get the values to balance properly when 20% VAT is added.  There is a blend of items that are non-VATable (books) and some have free shipping which might be complicating things when all put together in one order.

 

When the items are added individually to the basket -  the tax/shipping is correct for each item. But when the basket has the same 4 items together in 1 order - the tax is wrong - by £0.08.

 

Totally confused.

Reply 1 (1)
Andrew
Shopify Staff
Shopify Staff
1354 143 253

Hi @Camembear1

I can understand why this would be confusing, and I empathize with all the tax changes you're having to navigate since Brexit.

It sounds like you are seeing a negligible price difference of a few pence for an order of several items. The reason for this is likely because of tax rounding.

Tax is ordinarily charged at the line-item level. In the past, the tax for each line item was added together, and the total tax was rounded up.

However, tax is now rounded at the line-item level, which means the tax amount is rounded for every product individually.

So if you add items all to one order, and the tax is rounded up individually for each item, the total tax may be incrementally more than you anticipated.

There's an example outlined in our guide that I linked above:


I hope you find this information useful! In the meantime, you might also want to have a look at our introductory guide to UK Taxes.

Let me know if you have any other questions!

Andrew | Social Care @ Shopify 
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