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How a rate is found

The tax rate on a sale comes from two settings your company makes, and one list Extenda keeps:

SettingSet onExampleWho decides
tax regionthe store's business unit, as taxRegionIdESyour company: where the store is
taxable groupeach price of the item, as taxableGroupIdStandardyour company: what kind of goods the item is
the rateTax RulesES + Standard = 21 %the law, kept by Extenda

Region + group picks the rule, and the sale's date picks the rate. Nothing on the item or the store holds a percentage, so when a country changes a rate nothing of yours has to change.

The same bicycle, in taxable group Standard, sold in three stores. Madrid is in region ES, where Standard is 21 %, so 1,000.00 EUR before tax is 1,210.00 with tax. Las Palmas is in region ES-CN, where Standard is the Canary Islands' 7 %, so 1,070.00. Lisbon is in region PT, where Standard is 23 %, so 1,230.00.

The store's tax region​

Each store's business unit has a taxRegionId, set in Business Unit Management. Business Unit Management checks it against the list of regions from Tax Rules, and the region must belong to the business unit's country: a store in Spain can be in ES or ES-CN, not in PT. A store needs its region before it can sell.

A business unit that sells without tax is put in its region's tax-exempt twin, such as ES-TE.

The item's taxable group​

Each price specification of an item has a taxableGroupId, sent with the price to Product, Price and Promotion. The group is a legal choice your company makes: which kind of goods the item is, under each country's tax law. Extenda does not decide it.

The group is set per price, so an item sold in several countries can be in a different group in each, as long as each country has its own price.

Where the rate is used​

  • At the till. Store Data delivers the tax rules to the stores together with the items, and the till taxes each line by the store's region and the line's group.
  • In customer orders sent from another system. A webshop or an ERP sending an order with lines delivered from a warehouse gives each line a taxableGroupId. The order is refused if a group has no rule in the delivering store's region. See Customer Order data sources.
  • In the general ledger. The VAT on each sale is booked to an account chosen by the line's taxable group. See General Ledger accounting rules.

🛑 The same item in another country​

A taxable group has a rate only in the regions that have a rule for it, and the groups differ by country. When your company opens stores in a new country and copies its items from an existing one, an item can arrive in a group the new country does not have.

Bread is in taxable group SuperReduced. In the Madrid store, region ES, SuperReduced is 4 %. Copied to the Lisbon store, region PT, the same bread has no rate, because Portugal has no rule for SuperReduced: in Portugal, bread belongs in ReducedLow at 6 %.

The price is accepted, because SuperReduced is a valid group name, and the problem only shows at the till: the line cannot be taxed correctly, and in a country with fiscal signing the receipt can be refused.

Before the first store opens in a new country, compare the groups your items use there with the country's rules: the country pages list them, and GET /tax-rules?countryCode=PT gives the current answer. Every item should be in a group that has a rule in each region where it is sold.