VAT configuration on customer
When we determine the VAT that we use for the order, we start by checking the VAT configuration the customer:
The options here are:
Intra EU (reverse charge): this should be used when your company and the customer are inside of the EU. It will show reverse VAT as description on the invoice.
No VAT:
You should use this if your company is based in the EU and the customer is based outside of the EU
If you are based in the UK and the customer is based outside of the UK, then you should select this option
VAT: if your customer is based in the same country as yourself.
It is important that this is configured correctly. Based on the configuration on customer, Qargo will apply the following logic:
Customer is Intra EU => VAT on order will be set to reverse charge. We will ignore any configuration on the rate card.
Customer is No VAT => VAT on order will be set to No VAT. We will ignore any configuration the rate card.
Customer is VAT => we will think look at the configuration the rate card to determine which VAT % that we should use.
VAT configuration on rate card
If the customer falls under VAT, then we will go to check on the rate card what the VAT % is for each charge (UK example):
Most countries have the following types of VAT %:
Low: this is usually 0%
Medium: e.g 5% for UK, 6% Belgium, 9% Netherlands
High: e.g. 21% for Belgium and Netherlands, 20% for the UK
Special rules: export (e.g. containers) doesn't need to pay VAT in certain countries
So we will check in the rate card which % we should use. We will only do this if the customer falls under the VAT rules (Customer configuration is VAT), if the customer falls under reverse charge or No VAT then we won't apply this as those customers don't fall under the VAT rules.
VAT configuration on surcharges/extras
We want to avoid you having to configure the VAT % separately for each rate card, that's why we allow you to add the VAT % on the surcharges and the extras:
If you add these extras to a rate card, then we will automatically use the VAT % configured on this extra. This avoids you having to set it manually every time.