Parallels Virtualization and Automation Software

RESOLUTION

Say, you are a provider from Germany.

Rules for Taxation are:

• A customer from Germany with VAT number - the tax must be applied (the tax will be added to the order/invoice);
• A customer from Germany without VAT number - the tax must be applied (the tax will be added to the order/invoice);
• A customer from EU country with VAT number (business accounts only) - the tax must be exempted (the tax will NOT be added to the order/invoice);
• A customer from EU country without VAT number - the tax must be applied (the tax will be added to the order/invoice);
• A customer from non-EU country - the tax must NOT be applied at all.

So, you just need to setup taxation in HSPc:

1. Create 2 tax rates at "Top > Billing Director > Taxation Manager > Tax Rates":
   • "MwSt"- Tax rate for customers from Germany. Rate = 16%
   • "VAT" - Tax rate for customers from EU. Rate = 16%
2. Create a default tax zone without any tax rate. It will be applied for non-EU customers at "Top > Billing Director > Taxation Manager > Tax Zones".
3. Create separate tax zones for each EU country with 16% tax rate. The tax zone for Germany must be "MwSt". "VAT" - for all other countries from EU. I.e. each country must have its own zone at "Top > Billing Director > Taxation Manager > Tax Zones".
4. Setup "Tax calculation mode" at "Top > Billing Director > Taxation Manager > Setup" depending on options on including tax into price:
   • HP prices does not include taxes
   • Automatically approve VAT numbers for EU customers (do NOT use the option for tax exemption enabling)
   • HP prices include taxes from native tax zone (setup native tax zone as Germany's tax zone)
5. VAT number will be used for tax exemption automatically (as soon as a customer enters it in Online store during the very first registration or later set it in Control panel, or you set it for the customer via PCC/RCC) unless you set taxation in secure mode in "Top > Billing Director > Taxation Manager > Setup > Prevent orders from being paid until following information is approved > Customer tax exemption code (if any)". If you set this setting to "ON" then, you will have to approve VAT number manually.

If you set all settings like mentioned above then:

• customers from Germany will always be taxed;
• customers from EU countries will be taxed in accordance with VAT number presence;
• customers from non-EU countries will not be taxed at all.

For detailed information regarding configuring taxation you may check this article in HSPcomplete Provider's Guide