As a UK Retailer who ships to customers worldwide we need some help figuring out how to setup VAT in Magento. We need the following things done:

1 > All prices on the site to be inclusive of VAT

2 > Anyone buying our products from outside the UK & EU to have 20% removed off the shopping cart total as a VAT deduction.

How do we set this up? it must be standard for every UK retailer to have the same settings so why is there no clear cut information or process in doing this?


You would be best reading through the already written wiki section below on how to use the Magento tax settings:


It's all relatively straight forward if you follow the instructions in the above guide.

Work through example for EU store here:


Hope this answer helps you.


You need to configure:

1. Tax settings to have Catalog Priced - Included Tax. 
2. Shipping origin needs to be configured to UK.
3. After that you need to add tax rule which will have tax rate for all EU countries (UK is there too)
4. Do not setup tax rate for other countries, in this case VAT will be excluded automatically when address estimated to 'other' country.

Your Answer

By clicking “Post Your Answer”, you agree to our terms of service, privacy policy and cookie policy

Not the answer you're looking for? Browse other questions tagged or ask your own question.