• Resolved jswoolf01

    (@jswoolf01)


    We use Avalara as our way of ensuring that sales taxes are charged properly for our WooCommerce e-commerce store. Our product line includes memberships, which are sold to customers as a form of subscription. Each membership/subscription has an initiation payment, then regular monthly renewals until the customer cancels. Since we are located in a sales-tax-free state, we don’t want any of these transactions going to Avalara. The initial payments are already set to be tax-free, but I’m not seeing how to set it up so the renewals are also tax-free.

    Any help anyone can offer will ne much appreciated.

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  • Plugin Support Moses M. (woo-hc)

    (@mosesmedh)

    Hi @jswoolf01,

    By default, you can set up a 0% tax rate in WooCommerce and apply it to your subscription product, which will be effective for both the initial payment and subsequent renewals. However, I’d like to understand your specific setup and workflow better.

    Could you let me know which plugin you are using to manage your subscriptions? Additionally, please share your system status report by navigating to WooCommerce > Status > Get Report > Copy For Support. You can then share it through https://gist.github.com.

    To make your subscription product tax-free, go to WooCommerce > Settings > Tax in your WordPress dashboard. Ensure that tax calculations are enabled by checking the appropriate option. Then, create a new tax class for tax-free products under the “Tax classes” section and name it something like “Tax-Free” or another relevant term.

    Next, set the tax rate to 0% by going to the “Standard rates” or “Additional tax classes” tab. This will ensure that no tax is applied to both the initial purchase and future renewals. Lastly, when setting up your subscription product under Products > All Products > Edit, scroll to the Product Data section and select the newly created “Tax-Free” class from the Tax Class dropdown. As long as the 0% tax class is assigned to the product, it will be applied consistently, including during renewals.

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