VAT not calculated accordingly

Accounting & Taxes

Topic summary

A Swedish business with 25% VAT reported incorrect tax calculations in Shopify draft orders. Their prices are set as VAT-exclusive, but the system was calculating VAT incorrectly.

The Problem:

  • Expected: 1915 SEK subtotal + 478.75 SEK VAT = 2393.75 SEK total
  • Actual: System showed 383 SEK VAT instead

Resolution:

  • The original poster identified and corrected an incorrectly filled setting (specific setting not detailed in follow-up)
  • A community member explained that Shopify displays prices as VAT-inclusive at this level, so the calculation (1915/125*25=383) was technically correct based on how the system interpreted the input
  • The root cause was likely that prices were set as VAT-inclusive in the inventory’s global tax settings, rather than VAT-exclusive as intended

Status: Issue resolved through correcting the tax configuration settings.

Summarized with AI on October 23. AI used: claude-sonnet-4-5-20250929.
1

Hi,

We are a Swedish business with 25% VAT. We mainly sell to businesses and our prices in Shopify are excluding VAT. Therefore the VAT should be added on top of the prices but Shopify doesn’t do this.

Attached is a screenshot from a draft order:

Screenshot(210).png
Screenshot(210).png1106×636 38.8 KB

The correct numbers should be:

**Subtotal:**1915 SEK

VAT: 478.75 SEK
Total including VAT: 2393.75 SEK

Here is my Shopify TAX settings:

Screenshot(211).png
Screenshot(211).png987×508 17.2 KB

2

I found the issue, this was filled in incorrectly for some reason:

3

Hi sneldergruppen

In Shopify on this level you always see the price as VAT inclusive . From that point of view it is calculated correctly 1915/125*25=383. The most probable issue is that you had price inclusive precies in your inventory (see global tax settings)

MVH

Rostislav