Customizing VAT calculator

The first task is to identify whether the end customer qualifies for zero VAT. For this example, we will take the orders billing address to determine this: If the billing address is from another EU country, the VAT should be zero, else it should be as default normal VAT.

Important: Swedish tax regulations specify additional declarations to be printed in invoices with more specific requirements regarding the customer, the customers VAT registration, etc, which are not discussed here. Please read more here in Skatteverket site (in Swedish).

Determining whether VAT should be zero or not

According to the basic rule, if the billing address country is within EU (and outside Sweden) VAT should be zero (only for B2B transactions). We assume that the site is B2B, so we do not additionaly check whether transaction is B2B or not.

We can determine this by a simple method as follows:

       /// <summary>
        /// returns true if Billing address belongs to European Union except sweden.
        /// </summary>
        /// <param name="addressCarrier">The address carrier.</param>
        /// <returns>
        ///   <c>true</c> if [is EU billing address] [the specified address carrier]; otherwise, <c>false</c>.
        /// </returns>
        public bool ZeroVAT(AddressCarrier addressCarrier)
        {
            if (addressCarrier == null)
                return false;

            var countryCode = addressCarrier.Country.ToUpper();
            switch (countryCode)
            {
                case "BE": //Belgium
                case "BG": //Bulgaria
                case "CZ": //Czech Republic
                case "DK": //Denmark
                case "DE": //Germany
                case "EE": //Estonia
                case "IE": //Ireland
                case "EL": //Greece
                case "ES": //Spain
                case "FR": //France
                case "HR": //Croatia
                case "IT": //Italy
                case "CY": //Cyprus
                case "LV": //Latvia
                case "LT": //Lithuania
                case "LU": //Luxembourg
                case "HU": //Hungary
                case "MT": //Malta
                case "NL": //Netherlands
                case "AT": //Austria
                case "PL": //Poland
                case "PT": //Portugal
                case "RO": //Romania
                case "SI": //Slovenia
                case "SK": //Slovakia
                case "FI": //Finland
                //case "SE": //Sweden, sweden is removed since if from Sweden, VAT should be charged.
                case "UK": //United Kingdom
                    return true; //zero VAT for all EU countries...
                default:
                    return false;
            }
        }

Since this is determined when the billing address is set or changed, we need to make a note of whether to include VAT or not at that time. So we override the AddPaymentInfo method in the ICheckoutFlow concrete implementation, and mark out the order rows as having "NoVAT".

The complete code for the checkout flow change is as follows:

using Litium.Common.InversionOfControl;
using Litium.Foundation.Modules.ECommerce.Carriers;
using Litium.Foundation.Modules.ECommerce.Plugins.CustomerInfo;
using Litium.Foundation.Modules.ECommerce.Plugins.Deliveries;
using Litium.Foundation.Modules.ECommerce.Plugins.Orders;
using Litium.Foundation.Modules.ECommerce.Plugins.Payments;
using Litium.Foundation.Security;
namespace Litium.Studio.AddOns.Samples.Checkout
{
    /// <summary>
    /// Override the default checkout flow plugin implementation.
    /// </summary>
    [Plugin("KCSamples")]
    public class SampleCheckoutFlow : Litium.Foundation.Modules.ECommerce.Plugins.Checkout.CheckoutFlow
    {
        /// <summary>
        /// String used to mark order rows.
        /// </summary>
        public const string NoVAT = "NoVAT";
        /// <summary>
        /// Initializes a new instance of the <see cref="CheckoutFlowPlugin" /> class.
        /// </summary>
        public SampleCheckoutFlow(IDeliveryFactory deliveryFactory, ICustomerInfoFactory customerInfoFactory, IPaymentInfoFactory paymentInfoFactory, IOrderRowFactory orderRowFactory, IOrderFactory orderFactory)
            : base(deliveryFactory, customerInfoFactory, paymentInfoFactory, orderRowFactory, orderFactory)
        {
        } 

        public override PaymentInfoCarrier AddPaymentInfo(OrderCarrier orderCarrier, string paymentProviderName, string paymentMethod, AddressCarrier billingAddress, SecurityToken token)
        {
            var result = base.AddPaymentInfo(orderCarrier, paymentProviderName, paymentMethod, billingAddress, token);
            //if the billing address is in another EU country, and
            //if the site is a B2B site, mark the order rows as NoVAT.
            if (result != null && ZeroVAT(result.BillingAddress))
            {
                orderCarrier.OrderRows.ForEach(x => x.Comments = NoVAT);
            }
            else
            {
                orderCarrier.OrderRows.ForEach(x => x.Comments = string.Empty);
            }
            return result;
        }

        /// <summary>
        /// returns true if Billing address belongs to European Union except sweden.
        /// </summary>
        /// <param name="addressCarrier">The address carrier.</param>
        /// <returns>
        ///   <c>true</c> if [is EU billing address] [the specified address carrier]; otherwise, <c>false</c>.
        /// </returns>
        public bool ZeroVAT(AddressCarrier addressCarrier)
        {
            if (addressCarrier == null)
                return false;

            var countryCode = addressCarrier.Country.ToUpper();
            switch (countryCode)
            {
                case "BE": //Belgium
                case "BG": //Bulgaria
                case "CZ": //Czech Republic
                case "DK": //Denmark
                case "DE": //Germany
                case "EE": //Estonia
                case "IE": //Ireland
                case "EL": //Greece
                case "ES": //Spain
                case "FR": //France
                case "HR": //Croatia
                case "IT": //Italy
                case "CY": //Cyprus
                case "LV": //Latvia
                case "LT": //Lithuania
                case "LU": //Luxembourg
                case "HU": //Hungary
                case "MT": //Malta
                case "NL": //Netherlands
                case "AT": //Austria
                case "PL": //Poland
                case "PT": //Portugal
                case "RO": //Romania
                case "SI": //Slovenia
                case "SK": //Slovakia
                case "FI": //Finland
                //case "SE": //Sweden, sweden is removed since if from Sweden, VAT should be charged.
                case "UK": //United Kingdom
                    return true; //zero VAT for all EU countries...
                default:
                    return false;
            }
        }
    }

Changing VAT Calculator

Since the order rows are marked in its Comments field, the VAT calculator can now use this information in determining the exact VAT amount of each order row.

using Litium.Common.InversionOfControl;
using Litium.Foundation.Modules.ECommerce.Carriers;
using Litium.Foundation.Modules.ECommerce.Plugins.Vat;
using Litium.Studio.AddOns.Samples.Checkout;

namespace Litium.Studio.KC.Samples.VATCalculator
{
    [Plugin("KCSamples")]
    public class SampleVATCalculator:VatCalculator
    {
        public override void CalculateOrderRowVat(OrderRowCarrier orderRowCarrier)
        {
            //if the order rows are marked as NoVAT do not calculate VAT.
            if (orderRowCarrier.Comments == SampleCheckoutFlow.NoVAT)
                orderRowCarrier.TotalVATAmount = 0;
            else
                base.CalculateOrderRowVat(orderRowCarrier);
        }
    }
}

Note that, we determine the "Business Logic" of whether to have VAT or not during the checkout flow, and  use that information in the VAT Calculator. This helps to keep VAT calculator fast because the pricing rules calculations should be as fast as possible. Also, when it come to real implementation, the additional checks to determine whther an end customer is eligible for VAT or not is not possible during the VAT calculation step.