• Hello,

    Just wondering if this is possible.
    Our shop is located in Belgium.
    If you for instance select Germany as billing country and you enter a valid VAT.
    VAT is then deducted but you wish to ship to another address.
    Then you can select another country (eg Belgium) but the VAT isn’t recalculated.
    This is illegal since we cannot prove that this product will leave Belgium and therefore VAT needs to be payed.
    Is there a setting so when another shipping country is selected the VAT number is checked against that country as well?

Viewing 15 replies - 1 through 15 (of 18 total)
  • Plugin Author Omar AlDabbas

    (@omardabbas)

    Hi @sal363

    I see the point here, currently it’s not doable, but I will take this into consideration and see if we can include it in the next update.

    Will update you once it’s out.

    Omar

    Hi @sal363,

    I run into your post as I am thinking about the exact same situation.
    I called the tax authority (Austria) and they did not know themselves (great) and I am waiting for a reply.

    A)
    Shop: Belgium
    Buyer: from Germany with German VAT and German billing address
    → the VAT has to be exempt (0% VAT), which is done by the plugin
    → on the invoice it must state the VAT ID of both parties and a notice “tax-free intra-Community supply”

    B)
    Shop: Belgium
    Buyer: from Germany with German VAT and German billing address but a Belgium shipping address
    → what’s the correct amount to charge here? including German tax? including Belgium tax? or 0% tax because tax is exempted

    The plugin is acting the exact same way as in A. I am just not sure what is the legal correct way of doing it.

    Could you figure that out?

    Markus

    Plugin Author Omar AlDabbas

    (@omardabbas)

    Hi @markussss

    Thanks for the details, I’m not in a position to answer from a legal perspective (my guess is that you should charge VAT in B, but that’s not a legal advice), what I can help is developing an option to serve this need.
    To be honest, I’m still not sure what’s the best day to do it (from a UX point of view), to make it easier for admins to manage this.
    So if store is in Belgium, company from Germany, shipping to Belgium for example, if we need to charge VAT on this case, I assume it should be on Belgium rate, since you’re already involved in this and know its ins & outs, what would be the easiest option you like to see in the plugin for this scenario?

    @sal363, your suggestions are welcome of course.

    Omar

    I need to run some tests, but before thinking about UX – it’s necessary to figure out what the actual rules are and how the plugins works right now.

    I talked 3 times to the tax authorities today, which was more or less useless, unfortunately.

    The first test I run are not helping much. As the results are always different.
    It seems the calculation is unreliable.

    If I look at those two scenarios again, I get different results whenever I test it. It is unfortunately not behaving the same way and unreliable. Note, I am not actually testing with Belgium. In my particular case I test with Austria (shop) and Germany (buyer) ..should be the same though I think.

    A)
    Shop: Belgium
    Billing: Germany, German VAT
    Shipping: Germany
    → expected result: 0% tax
    → actual result: it depends

    B)
    Shop: Belgium
    Billing: Germany, German VAT
    Shipping: Belgium
    → expected result: Belgium tax, as the good are never leaving Belgium
    → actual result: it depends

    It depends on:
    – if the validation works or not
    – the order on how I use the checkout page, e.g. check shipping first/later, change country of shipping, change country of billing, modify billing VAT, page refresh, etc.

    I didn’t see a pattern yet, feels it’s acting arbitrary.

    I tried B) several times and will get different results, depending on how I fill it out. I am also able to reproduce A) and get the results with added tax, even though there shouldn’t be.

    As far as I see it, this is a big problem. However, I only tested this on one shop. So I cannot guarantee if this is a global issue with the plugin / WooCommerce calculation.

    Do you know more about that?

    @sal363 I hope this is also in your interest. I think we have the same concern.

    Thread Starter sal363

    (@sal363)

    Hello again,

    Well the situation should be in the view of the goods and not if the VAT number is ok.
    SO If you send goods outside your country and they can link a valid VAT number to that country they should get 0% VAT.
    But if they then ask to ship it to another country (outside their country) the local VAT should be applied.
    This is how my old plugin works as well.
    (goes out of service so that’s why I was looking into this plugin.)
    Once it’s implemented I can switch to this plugin.

    Plugin Author Omar AlDabbas

    (@omardabbas)

    Hi @sal363 & @markussss

    Thanks for the feedback, the cases you mentioned @markussss in A are less-likely to be honest, because you have 1 billing & shipping address, once you fill a VAT number, it will automatically validate & preserve/remove VAT.

    I will look into B, since based on @sal363 confirmation, it should be 0% here.

    What happens beyond shipping is really out of the plugin scope, I will add a feature to keep VAT is shipping country is different from billing.

    Will let you know once it’s out.

    Omar

    I second sal363. I’m not replying from a tax legal perspective but just as an experienced user in these same situations.

    In all (99%) of the webshops I buy I get the VAT calculated over the goods and shipment costs.
    I do have a valid company with a valid VAT number. Due to the COVID I had to re-organize operations a bit so Irish company operating mostly out of Holland.
    If I order now for R&D from a webshop, billing will go to Ireland but shipping to Holland. In 99% of the transactions, I get VAT invoiced of the country of the webshop.
    I even once got an email from a webshop stating that they didn’t invoice the VAT correctly (0%) complaining they now have to pay the VAT amount.

    So yes, I cannot use this plug-in until solved

    Thread Starter sal363

    (@sal363)

    Any update on the progress of this case?

    Plugin Author Omar AlDabbas

    (@omardabbas)

    Hi @sal363

    Unfortunately not much, I wasn’t able to find a supporting legal reference to allow this, and can’t include a feature that goes against regulations in the plugin.

    Nevertheless, I explored options to make it help, some of them are doable, for example, currently the plugin allows verifying billing country, what can be done is adding a new option to match both (billing & shipping), this way you can guarantee the VAT will only be removed if order is being shipping & billed to the same country.

    Shipping to another country will force the VAT to be applied in this case, will this do it for you & @markussss & @champ8242?

    Omar

    Sorry for not responding earlier .. when doing something else for some time, it’s always difficult to get back into the topic.

    All I know from whatever I have seen so far, the shipping country is the country that is considered as reference for applying the respective rules (i.e. billing with/without VAT when VAT ID is added)

    Shipping & billing country equals shop country → local tax is applied
    Shipping & billing country outside shop country → no tax applied when there is a valid VAT ID
    Shipping & billing country different from each other → don’t know the details, but applied regulations should be based on shipping country where the goods will be sent

    best regards
    Markus

    Thread Starter sal363

    (@sal363)

    Hi,
    I explored some more.
    In this article you can see that if you ship to another country then the VAT country number you need to add VAT.

    Warning: if the VAT number used by the purchaser is not from the country of destination, in the opinion of the ECJ of 22.4.2010 (C-536/08 and C-539/08), no deduction is allowed. In the third-country VAT will be charged and might only be refunded if there is a proof of taxation in the destination country.

    link to article:
    Link Here

    After some time I did some testing again with the latest version of the plugin.

    Some time ago I said the following, which I cannot replicate anymore. That is a good sign. In whatever order I checked/unchecked different shipping address, added/deleted VAT, etc. – it was reliable and I always experienced the same results

    It depends on:
    – if the validation works or not
    – the order on how I use the checkout page, e.g. check shipping first/later, change country of shipping, change country of billing, modify billing VAT, page refresh, etc.

    I again checked only the most important cases and can tell that one single issue persist which is a use case that is definitely happening in real life.

    When the VAT number is applied and matches the billing country, but the shipping goes to a different country, the tax is not added → I can’t imagine this is correct, and I think that’s the main issue we discuss from the very beginning
    e.g. shop in Austria, buyer with German VAT and German billing address ships to an address in Czech Republic.
    → the Czech tax has to be applied

    Currently the tax is exempted, which means no tax is applied.

    Plugin Author Omar AlDabbas

    (@omardabbas)

    Hi @markussss, @sal363, @champ8242

    Thanks for waiting, it took much longer than expected, I just released a new version where you can verify if billing country is the same as shipping country, if so, you will be able to keep VAT to the total amount.

    Please update to latest version and let me know your feedback.

    Omar

    Thread Starter sal363

    (@sal363)

    Hello @omardabbas ,

    Thanks for the headsup.
    I see you did a great job!
    But I found a bug.
    Shop location Belgium.
    I want to order to a country (e.g. The Netherlands) where the VAT is 0%.
    Then I want to select shipping to other country (e.g. Germany).
    Vat is again added (even the correct country VAT) which is great.
    But if I uncheck it again then the VAT stays on for the Netherlands and the VAT number is declined. Only a refresh seems to reset this.

    Plugin Author Omar AlDabbas

    (@omardabbas)

    Thanks @sal363 for the feedback, glad to hear this.

    I think I got it, it might be tricky since it needs to change without a refresh, will tackle this in the next update.

    Omar

Viewing 15 replies - 1 through 15 (of 18 total)
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