Tax code issue

  • Resolved contextquestion

    (@contextquestion)


    4 months, 3 weeks ago

    Good morning everyone! I hope you can help out with an issue I’ve been experiencing.

    Since the big WooCommerce update (9.0) we’ve discovered a strange issue with VAT in B2B situations within Europe.

    For context, we’re a company located in the Netherlands. B2B invoices within Europe* now show “(inc. 0.00% VAT) Supply of services subject to reverse charge”. [* except B2B purchases from within our own country] In theory, this is very convenient as we had to manually add ‘VAT Reverse Charge’ before, however, we only sell goods and it states ‘services’. In our bookkeeping extension we also discovered that WooCommerce marks the shipping costs as services instead of goods, but only for B2B interactions within Europe. For outside of Europe, within our own country or B2C purchases within Europe, it gives the correct tax code. I suspect these two situations are connected to each other. The support from our bookkeeping extension told us we should contact WooCommerce for this issue, as those tax codes were automatically given by WooCommerce’s API. For the life of me, I cannot find where the settings are for that Reverse Charge sentence on the invoices, nor where I can set the tax codes for shipping. All our products are ‘simple products’.

    TLDR: where can I change the “services” to “goods” in “(inc. 0.00% VAT) Supply of services subject to reverse charge” on invoices and how do I change the tax code for shipping?

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Viewing 8 replies - 1 through 8 (of 8 total)
  • Plugin Support Zubair Zahid (woo-hc)

    (@doublezed2)

    Hello contextquestion

    Thank you for contacting Woo support.

    To better understand the problem you are facing, I need a little bit more information.

    We’re a company located in the Netherlands. B2B invoices within Europe* now show “(inc. 0.00% VAT) Supply of services subject to reverse charge”. [* except B2B purchases from within our own country]

    Could you edit a few orders and share screenshots of the order details with me?
    You may hide the sensitive information.

    Next, navigate to WooCommerec → Settings and click the Tax tab at the top.
    Then share screenshots of the Tax settings and also of the Tax rates you have set up.

    May I ask which bookkeeping extension you are using?
    It would help me understand the overall situation.

    I would be be happy to assis you further once I have more information. ??

    Best regards.

    Thread Starter contextquestion

    (@contextquestion)

    Dear Zubair,

    Thank you for your answer.

    I have created some screenshots for you. If you need more, or specific information, please tell me so.

    We use E-boekhouden, which uses the REST API of WooCommerce.

    Kind regards.

    NL to BE B2B order:
    Backend view
    Invoice
    NL to DE B2B order:
    Backend view
    Invoice
    Tax settings:
    Tax options 1
    Tax options 2
    Tax rates 1
    Tax rates 2

    REST API view

    Thank you for reaching back, with further details on this @contextquestion .

    Based on this screenshot, the phrase appears on invoices – not part of the core WooCommerce that is supported here.

    From the site’s System Status Report (SSR), shared above, it appears the following plugins are active and have to do with invoicing at the store:

    • PDF Invoices & Packing Slips for WooCommerce: by WP Overnight – 3.8.4
    • PDF Invoices & Packing Slips for WooCommerce – Professional: by WP Overnight – 2.15.10P
    • DF Invoices & Packing Slips for WooCommerce – Premium Templates: by WP Overnight – 2.21.8

    Feel free to reach out to its support channel, as they would be in a better position to assist you.

    I trust that points you in the right direction, but if you have more questions, let us know.

    We’re happy to help.

    Thread Starter contextquestion

    (@contextquestion)

    Dear anastas,

    Thank you for your answer.

    I disabled those plugins, and the sentence still shows. The ‘pro’ WooCommerce plugins have not updated in a few months, which leads me to believe that these do not impact the newly appeared sentence about reverse charging vat. I don’t know what causes it to show, only that it started very recently since the big WooCommerce update.

    However, even if that phrase itself would not be part of the WooCommerce core, I am still stuck with WooCommerce labelling shipping in the incorrect tax code, as a service. I need to know where that comes from, what determines the tax code? I can’t see where I can select the tax code belonging to shipping.

    Kind regards.

    An order with the invoice plugins disabled (NL to BE, B2B):
    Backend view
    Invoice mail

    Thank you for reaching back, clarifying things further @contextquestion .

    I went ahead with browsing the WooCommerce changelog (this was the closest, but not exact match), placed test orders on a test site of mine, and searched the WooCommerce source code. There was no reference that I could find in these places, I’m afraid.

    Gut feeling: this is added by an email template that was edited.

    I don’t know what causes it to show, only that it started very recently since the big WooCommerce update.

    Could you go ahead with temporarily deactivating the WooCommerce EU VAT Number: by WooCommerce – 2.8.9 plugin, before placing another test order, and see if the phrase still appears, or otherwise?

    If it still appears, I’d recommend proceeding with a?conflict test, as detailed here, for finding out.

    I am still stuck with WooCommerce labelling shipping in the incorrect tax code, as a service. I need to know where that comes from, what determines the tax code? I can’t see where I can select the tax code belonging to shipping.

    As I understand, you are referring to the product shipping classes (documentation linked here, for reference). They can be further combined with shipping settings, and set as taxable.

    I hope this is helpful! Please let us know if you have any further questions about this matter, or if we misinterpret your concern in any way. We will be happy to help you further.

    Thread Starter contextquestion

    (@contextquestion)

    Dear Anastas,

    Thank you for looking into this.
    I can’t properly test this without the WooCommerce EU VAT Number: by WooCommerce – 2.8.9 plugin, as without that, I do not have a EU VAT number input, and that means that all orders are B2C, not B2B, (and thus it would not trigger the phrase).
    Here is the test anyway:
    Backend view without EU VAT plugin
    Mail invoice without EU VAT plugin

    Thanks for the links. That’s not my issue though, but perhaps I worded it in an unclear manner. I’ll use a picture to clarify it:
    E-Boekhouden view
    The first number, €40,50, is the order amount itself, so 1 item that cost €40,50 in a B2B sale (within Europe, excluding The Netherlands). It states ‘Goederen naar binnen de EU 0%’, which means that these are marked as goods for the tax code. The second number, €5, are the shipping costs for the order. It states ‘Diensten naar binnen de EU 0%’, which means that they are marked as services for the tax code. These shipping costs need to be marked as goods as well, not services. E-Boekhouden, the program we use, uses the WooCommerce API to pull information in from the orders. Their support told us that this is a WooCommerce problem. I need to know what is making the shipping costs themselves a service instead of goods. We have no issue with the tax codes for our products, nor the tax percentages on them. It’s only the tax code of the shipping costs themselves that pose an issue in B2B transactions within Europe. The tax rates are properly applied (they show the right tax in the right situation).

    As a side note, I apologize if I worded this harshly. I’m very direct. It is not my intention to come across as hostile.

    Plugin Support omarfpg a11n

    (@omarfpg)

    Hi @contextquestion,

    Zooming out on this issue, as I understand you’re trying to find where a setting or a string comes from. Sometimes when I’m lost in that way, the String Locator plugin helps me determine where a string or a setting come from exactly, which plugin, which path, which file, which function.

    Have you considered giving that approach a try?

    Thanks!
    -OP

    Plugin Support omarfpg a11n

    (@omarfpg)

    Hi there ?? ,

    We haven’t heard from you in a while, so I’m going to mark this as resolved for now. Feel free to start a new thread or reply back if you have any more questions.

    All the best,
    Omar

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