Configure tax

Taxes can be calculated either by Composable Commerce or by a third-party tax calculation service. The option you choose generally depends on how complex the taxes are in the areas where you sell your products. For example, in the United States or Canada, each state or province might have different tax rates. Tax rates can also differ depending on the products being sold. In these cases, merchants typically use a third-party tax calculation service.

You can configure commercetools to handle net prices, with taxes calculated automatically. This allows B2B companies to purchase and sell based on net prices, while still maintaining the tax information needed for certain processes or services.

Configure taxes

To view and manage your Project's tax configuration, do the following:

  1. Open the Merchant Center.
  2. Go to Settings > Project settings.
  3. Select the Taxes tab.

In the Taxes tab, you can configure Tax Categories, which store individual Tax Rates like VAT or sales tax. When you define a Tax Rate, you have the option of including the tax in the price of each product. To do this, select the Included in price checkbox. However, if you're using a third-party tax calculation service, be sure to leave this option unselected to ensure prices are properly displayed. To learn more about configuring taxes in your Project, see our Taxes guide.

Third-party tax calculation

If you decide to calculate taxes externally using a third-party tax calculation service, we recommend that you select one from our Integration Marketplace. The marketplace provides pre-configured integrations for use in your Project. Once you've chosen an external service, see our Tax integration guide to get set up.

Further reading

To learn more about how the overall checkout process works with Composable Commerce, we recommend that you read our Checkout best practices guide.