How to Enable VAT (Tax) in WooCommerce

Introduction If you need to charge VAT (Value-Added Tax) on your WooCommerce store, this guide will walk you through turning on taxes, setting VAT rates, and displaying prices correctly. We’ll keep each step clear and simple.

1. Turn On Taxes in WooCommerce

1. Log in to your WordPress dashboard at yourwebsite.com/wp-admin.

2. Go to WooCommerce > Settings.

3. Click the General tab.

4. Scroll down to Enable Taxes and check the box next to Enable tax rates and calculations.

5. Scroll to the bottom and click Save changes.

2. Configure Tax Options

1. Still in WooCommerce > Settings, click the Tax tab (it appears after you enable taxes).

2. Under Tax options, set how prices are entered and displayed:

   • Prices entered with tax: Choose Yes, I will enter prices inclusive of tax or No, I will enter prices exclusive of tax depending on how you want to work.

   • Calculate tax based on: Select Customer shipping address, Customer billing address, or Shop base address.

   • Display prices in shop: Choose Including tax so customers see VAT-inclusive prices.

   • Display prices during cart and checkout: Also select Including tax for clarity.

3. Click Save changes.

3. Add VAT Tax Rates

1. In the Tax tab, under Standard rates, click Insert row.

2. Enter your VAT rate details:

   • Country Code: Enter your country’s ISO code (e.g., IE for Ireland).

   • State Code: Leave blank unless you charge different rates by region.

   • Rate %: Enter your VAT percentage (e.g., 23.00).

   • Tax name: Enter VAT.

   • Priority: Leave as 1 for a single rate.

   • Compound: Leave unchecked unless you need compound taxes.

   • Shipping: Check if VAT should apply to shipping charges.

3. Click Save changes.

4. Verify VAT on a Product

1. Go to Products > All Products.

2. Edit an existing product or add a new one.

3. Scroll to the General section of the Product Data box.

4. Under Tax status, choose Taxable.

5. Under Tax class, select Standard (or the class you created).

6. Click Update or Publish.

5. Test VAT Calculation on the Cart

1. Visit your store’s front end and add a taxable product to the cart.

2. Go to the cart or checkout page.

3. Ensure the VAT amount appears in the order summary and that the total price includes VAT.

Congratulations! You’ve successfully enabled and configured VAT on your WooCommerce store. Customers will now see tax-inclusive prices and VAT will be applied at checkout. If you have any questions or need to add different tax rates (e.g., reduced rates), revisit the Standard rates or add new rows under Reduced rate rates.

Feel free to reach out if you need further assistance!