Creating manual taxes and tax override [NB]

In many areas of the Back Office you will have to enter tax or VAT rates, such as for products, payments and shipping methods.

To create a tax

  1. On the left menu of the Back Office click Settings and from Payment Settings choose Taxes.
  2. From Manual Tax rates click Add a tax rate.
  3. Give the rate a name, such as Children's clothing. Enter a tax rate.

If you use several rates, you can choose one as the standard rate by clicking  Default. This rate is now automatically applied when you add new products.

To create a tax (override) if you are in the United States

  1. On the left menu of the Back Office click Settings and from Payment Settings choose Taxes.
  2. Click United States.
  3. From Tax Classes click Add a tax class.
  4. Give the tax class a name, such as Children's clothing.
  5. Click the tax class you want to work with, add products to it and save your changes.
  6. From Settings go to Taxes and click United States.
  7. Click Add a tax override and select a tax class.
  8. In the Tax Overrides area click the tax override and configure it.
  9. If you are in New York state and your tax class is clothing, from Tax Rules select New York Clothing under $110.
  10. In the Tax Rates area, for each state that you have a store in, enter the rate.
  11. For each state you can optionally apply the rate to all counties and cities.

To create a tax override if you are in Canada

  1. On the left menu of the Back Office click Settings and from Payment Settings choose Taxes.
  2. Click Canada.
  3. From Tax Classes click Add a tax class.
  4. Give the tax class a name, such as Children's clothing.
  5. Click the tax class you want to work with, add products to it and save your changes.
  6. From Settings go to Taxes and click Canada.
  7. Click Add a tax override and select a tax class.
  8. Click the tax override and configure it.
  9. In the State/Provincial area for each province that you want to apply the override to, enter a rate, and optionally change the name and tax type:
    • Combine with the federal tax: add the rate to the country's rate.
    • Replace the federal tax.
    • Compounded with the federal tax: the federal tax is applied to the subtotal, then the tax override is applied.

To create a tax override if you are in the European Union

In Europe threshold values are considered for applying VAT. Are you selling more in a year to people or entrepreneurs who do not declare, or organizations that are not legally classified as entrepreneurs, than the threshold values established by the tax authorities? If so you must charge the VAT rate for the customer's country.

This is necessary only when your turnover for a country exceeds its threshold value. If your turnover is lower than the threshold value, or you sell only in the country you're located in, you don't need to configure a tax overrides.

  1. On the left menu of the Back Office click Settings and from Payment Settings choose Taxes.
  2. Click the name of the tax you want to create an override for, such as Children's clothing.
  3. Click Add a tax override
  4. Configure the override:
    • Country – Select the country you want to apply the override to.
    • Region - Optionally select a region.
    • Tax name – Enter a name that the override applies to, such as VAT.
    • Tax rate - Enter the applicable tax rate for the country that the threshold value has been reached for.
    • Tax type - select how the rate is applied.
      Combine with the federal tax: add the rate to the country's rate.
      Replace the federal tax.
      Compounded with the federal tax: the federal tax is applied to the subtotal, then the tax override is applied.
  5. Click Save to add the tax override. The tax rate that you have configured will now be applied to all new orders from that country.
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