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We have the Default Tax Destination Calculation in Configuration -> Sales -> Tax set as United Kingdom for the country then * in State and Post code.

VAT is all set up for the UK and working as it should. We have no other Tax rates or zones set up.

We have just had an order from Denmark, and the system has not applied VAT to the order. But the default Tax rate is set to the UK so it should have added VAT by default.. Any idea why it sis not?

Have we got another setting somewhere set up wrong?

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Tax is applied per country, you don't have any tax set up for DK. You need to set up all the EU countries with the VAT rate you want to charge them, normally your native rate (20% VAT), in Manage Tax Rates, and then apply it in Manage Tax Rules

  • OK, thanks for the info - so the default tax rate means nothing, you still have to set up a tax rate for every country in the world that you accept orders from, otherwise they will have no tax applied.. – user3032942 Nov 6 '14 at 10:18
  • No, You have to set up a tax rate for every country in the world where you're liable to collect tax. If you're based in the UK then that's the other members of the EU. Do you mean these defaults? magentocommerce.com/knowledge-base/entry/… They're for when magento doesn't know where the order is going. – Richard Nov 6 '14 at 10:24

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