Archive for October, 2011

VAT in the EU using Magento

Posted by: Genevieve Monday, October 24th, 2011

VAT – what’s the deal?


WebShopApps is based in the UK and we sell extensions all over the world, so like many eCommerce businesses, we have had to get our head around VAT rules.

Our understanding is that:

  1. VAT is charged at your local VAT rate to all non-VAT registered customers based in the EU
  2. For VAT registered business customers outside of your country in the EU, VAT is NOT charged ( they instead pay it themselves at their local rate)
  3. For customers outside of the EU, no VAT is charged

More information on the UK VAT rules are available from HM Revenue & Customs

If you already have your tax rules setup for the EU (1 & 3 above), you can skip the next section and jump down to ‘what about VAT registered business customers?’

How has WebShopApps set up VAT in Magento?

  1. First we have created product classes in Sales>Tax >Product Tax Class – we simply use Taxable Goods but you may need to have VAT standard, VAT reduced rate and Zero rated if you have products at different tax rates
  2. We then set up tax rates in Sales>Tax> Manage Tax Zones and Rates. We have one entry for every EU country with a rate of 20% and a rate for Jersey and the Channel islands of 0% (based on postcodes). We’ve exported our EU Tax Rates csv file, which you can import under Sales>Tax>Import/Export tax rates to save some time. EDIT: These rates are for B2B where tax prices are exclusive. If you are doing retail or you are using tax inclusive pricing, you will need to assign Guernsey and Jersey to their own country codes GY and JE. Thanks to Robbie Donaldson for the tip.
  3. Next we created a tax rule in Sales> Tax>Manage Tax Rules that applies to our product tax class (created in step 1), our standard customer groups and includes all of the tax rates (created in step 2)
  4. In our catalog we then select the Product tax class on our goods

Now we will be charging the correct amount of VAT to customers in EU countries and no VAT to customers outside of the EU.

What about VAT registered business customers?

Effectively, you have a group of customer that shouldn’t be taxed, no matter what they buy. So you need to set that at the customer tax class level.

  1. Create a new customer tax class under Sales>Tax>Customer Tax Classes, ours is called EU Business Customers
  2. Don’t apply any tax rules to this group, as they aren’t charged any tax
  3. Create a new Customer Group under Customers>Manage Customer Groups, again ours is called EU Business Customers, and assign your tax class in step 1 to it
  4. If you haven’t already, add the VAT number field to your checkout under System>Configuration> Customers>Customer Configuration> Name and Address Option > Show Tax/VAT number

Now when a customer checkouts and enters a VAT number you can verify it using the VIES service and if it’s valid, add them to the customer group you created in step 3, oh, and don’t forget to refund the VAT they got charged on their first order.
If, like us, you have hundreds of customers and many new ones each day, this manual processing quickly becomes a headache.

How can we help?


That’s why we wrote EU VAT Checker extension.
It will:

  • Check a customer’s VAT number during registration, at the checkout or from the admin panel for admin orders. This is done through the VIES web service, run by the EU.
  • Automatically add them to the correct customer group, so they only need to be validated once (for registered customers)
  • Remove the VAT from their order

It has lots of other features and configuration options so you can control, for example, what happens when the web service is down and whether to verify the syntax first. It’s a great little extension and comes with our full recommendation because we use it ourselves!

Meet Magento UK 2011

Posted by: Josh Wednesday, October 19th, 2011

big ben

So we were only just about starting to get over the excitement from the San Francisco Innovate conference but its not over yet because another exciting event is around the corner and right in our backyard which is Meet Magento UK.

After such a great event in San Francisco and the opportunity to mingle with the powerhouses of Magento and other key players in the US, we look forward to the opportunity to meet some of the U.K and Europe key players at this first ever U.K meet-up.

The event, taking place on Wednesday, October 26 at the Queen Elizabeth II Conference Centre in London will be bringing the best of the United Kingdom and Europe E-commerce ecosystem together.

The conference will showcase the latest news about Magento, educational lectures for merchants and developers and an exhibition area where you can come speak to us and other experienced e-commerce experts.

As a Trusted Extension provider for Magento, mainly within the shipping space, we will be showcasing some of our products and available to chat and discuss how we could provide the missing pieces to your Magento puzzles.

So if you want to meet WebShopApps and find out a bit more about what we do or how we can work together then come chat to us at the conference. We will be at booth number 6 so don’t hesitate to come say hello.

We are proud to be a Gold sponsor of the event and cant wait to attend, meet everyone and be part of all the action in London.

If you would like to schedule a meeting with the Director, Karen Baker on the 25th or 26th then contact us.

The future of Magento in the new X.com world

Posted by: Karen Tuesday, October 18th, 2011

Remember that blog I wrote a while back raising some of the concerns when eBay acquired Magento? Time to revisit.

 

I certainly wasn’t the only one asking ‘are they Apple or Microsoft’?

 

 

 

X.Commerce Innovate 2011 has been and gone. So what’s changed in Magento World?  Here are my own thoughts:

  1. Magento isn’t going anywhere fast. This is a big part of X.com
  2. Community, community, community. It’s a fact, we have more connections to merchants than X.com can make directly.  So by supporting developers/design agencies they are in turn supporting merchants. Hallelujah!
  3. The App Store will only get bigger and hopefully smarter. This will relieve developers to do what they do best – develop
  4. X.com realise that developers may be able to do things better than them. Wow, this is a real Apple moment. Amazing!
  5. Magento Go is being re-shuffled to support extensions.  WebShopApps are the amongst the first to release a Trusted Extension
  6. There will be more opportunities opening up to both merchants and developers. It’s exciting times for all

The overriding sense I got from Innovate 2011 was that Magento/X.com haven’t become arrogant, they are not complacent, and they know that hard work is ahead.  You can also see this amongst the design agencies large and small, the extension developers and the individual designers. I could almost spot Magento people walking around as they seemed so friendly and down-to-earth.
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And, in my opinion this is one of the truly great things about Magento. It brings together people from all walks of life, this isn’t just for techies or just for corporate bods.  You can be niche, you can big or small, and you can make a difference.

The common factor amongst everyone at the #preinnovate tweetup was the sheer passion for Magento, and that we all truly love our jobs. That’s a great feeling, and we are privileged to be a part of this journey.

Having personally worked both in large companies and startups my advice to eBay is definitely to listen to the philosophy of a startup, do not hemorrhage money and become an unwieldy machine. Do not sit on your perch looking down at the masses. Follow the example of Magento, get involved, stay agile, muck in, understand, learn and evolve. Then together we will be successful.

Apple or Microsoft?  They seem to be making progress ;)