Tax class
Tax classes are used to group similar products into the same tax class. "Public transport tickets" and "food" could be different tax classes. All products in the same tax class will have the same VAT percentage in the same country, but the same tax class can have different VAT percentages in different countries. This will make it easier to manage products that are sold in several countries. All countries have a standard VAT rate, and then you can add tax classes for other types of products.
Configuring tax classes
The VAT percentages for different tax classes are configured in two steps in back office Settings:
- Create the tax class in System settings > Tax classes. Click New and enter a descriptive name for the tax class that can be linked to the tax authorities' rules about tax classes (for example "Food" or "Printed books"). The tax classes that you create will be available for all countries that you set up.
- Click Countries > select a country > Edit and enter the appropriate percentage for each tax class.