Taxes¶
This topic contains the following sections:
Overview¶
Tax rules help OroCommerce find the correct tax rate that should be used for the products listed in the purchase order by matching the product tax code that indicates:
- a tax status of the product,
- a customer tax code that indicates the tax status of the buying company, and
- a tax jurisdiction where the tax is due.
OroCommerce supports a tax exemption mechanism: you can set zero tax rate for some customers and/or products.
Basically, in OroCommerce, a tax rule binds the following items:
- tax jurisdiction – an address, usually a state in a country that has defined taxation policies that determine when and how the company should pay their sales or VAT tax, and what rates should be used, depending on the tax status of the products you sell and the parties you sell to.
- customer tax code – a label for a customer or customer group that follow similar taxation rules in at least one tax jurisdiction.
- product tax code – a label for a group of products that have similar taxation rules in at least one tax jurisdiction.
- tax rate – the percentage of the sales income that should be paid as a tax in the particular tax jurisdiction for a certain type of products sold to a group of customers with the same tax status.
Before You Begin: Taxation Configuration¶
OroCommerce groups taxation configuration options into the following categories:
Understanding Tax Rules¶
Tax rules help OroCommerce find the correct tax rate that should be used for the products listed in the purchase order by matching the product tax code that indicates:
- a tax status of the product,
- a customer tax code that indicates the tax status of the buying company, and
- a tax jurisdiction where the tax is due.
OroCommerce supports a tax exemption mechanism: you can set zero tax rate for some customers and/or products.
Basically, in OroCommerce, a tax rule binds the following items:
- tax jurisdiction – an address, usually a state in a country that has defined taxation policies that determine when and how the company should pay their sales or VAT tax, and what rates should be used, depending on the tax status of the products you sell and the parties you sell to.
- customer tax code – a label for a customer or customer group that follow similar taxation rules in at least one tax jurisdiction.
- product tax code – a label for a group of products that have similar taxation rules in at least one tax jurisdiction.
- tax rate – the percentage of the sales income that should be paid as a tax in the particular tax jurisdiction for a certain type of products sold to a group of customers with the same tax status.

Tax Rules Creation Prerequisites¶
Before setting up a tax rule, make sure to complete the following actions:
- Create a customer tax code and apply it to a certain customer or a customer group who has fixed tax rates.
- Create a product tax code and apply it to the required products with fixed tax rates so that only the products that are subject to be taxed are taxed during a checkout.
- Create a tax jurisdiction (country, state, and a range of zip codes) to determine where and how the company should pay their sales or VAT tax.
- Create a tax rate (%) defined by the tax jurisdiction for the customers you are serving and the products you are selling.
- Finally, create a tax rule that associates the customer tax code, the product tax code, and the tax jurisdiction with the tax rate or the tax exemption (zero rate).
Note
See a short demo on how to create tax codes and jurisdictions in OroCommerce, or keep reading the step-by-step guidance below.
Create a Customer Tax Code¶
A customer tax code is a label for a group of customers that indicates the tax obligations and exemptions that a customer has. These tax obligations are considered when a customer submits an order.
To create a new Customer Tax Code:
Navigate to Taxes > Customer Tax Codes in the main menu.
Click Create Customer Tax Codes.
The following page opens:
Fill in Code and Description with information about the Customer Tax Code you are creating.
Click Save on the top right of the page.
The new Customer Tax Code is created.
Link the Tax Code to a Customer or a Customer Group¶
Customer¶
To link a tax code to a customer:
- Navigate to the necessary customer and open it for editing (e.g. click Customers > Customers in the main menu, filter customers to find the one you need, hover over the More Options menu to the right of the item and click to start editing its details).
- In the General section, in the Tax Code list, select the tax code that matches customer’s tax obligations.

- Click Save.
A clickable tax code link is now available in the Customer details.

Customer Group¶
A tax code assigned to a customer group is by default applied to the customers in a group, until they have the overriding tax association in their details.
To link a tax code to a customer group:
- Navigate to the necessary customer group and open it for editing (e.g. click Customers > Customer Groups in the main menu, filter customer groups to find the one you need, hover over the More Options menu to the right of the item and click to start editing its details).
- In the General section, in the Tax Code list, select the tax code that matches customer’s tax obligations.

- Click Save.

A clickable tax code link is now available in the Customer and Customer Group details.
More details on how to manage customer tax codes are described in the Customer Tax Codes section.
Create a Product Tax Code¶
To create a new Product Tax Code:
Navigate to Taxes > Product Tax Codes in the main menu.
Click Create Product Tax Codes.
The following page opens:
Fill in Code and Description with information about the Product Tax Code you are creating.
Click Save on the top right of the page.
The new Product Tax Code is created.
Link the Tax Code to a Product¶
To link a tax code to a product:
Navigate to the necessary product (e.g. click Products > Products in the main menu, filter products to find the one you need).
Hover over the More Options menu to the right of the item and click to start editing its details.
In the General section, in the Tax Code list, select the tax code that matches tax regulation for the product.
Click Save.
A clickable tax code link is now available in the Product details.

More information on how to manage product tax codes is provided in the Product Tax Codes section.
Now that you have created both customer and product tax codes and assigned them to the required customers and products, you need to create a tax jurisdiction which is an address that has defined taxation policies. A tax jurisdiction is used to specify what rates should be used depending on the tax status of the products you sell and the customers you sell to.
Create a Tax Jurisdiction¶
To create a new tax jurisdiction:
Navigate to Taxes > Tax Jurisdictions in the main menu.
Click Create Tax Jurisdiction.
The following page opens:
Fill in Code, Description.
Select the country from the list.
Select the state from the list.
Type in the Zip code ranges that should be covered by this tax jurisdiction (click +Add to capture additional range).
Click Save on the top right of the page.
The new tax jurisdiction is created.
For more details on how to manage a tax jurisdiction, refer to the Tax Jurisdiction section.
Once the tax jurisdiction is created, you need to create a tax rate for this jurisdiction to determine the percentage of a sale or order that is required to be paid as a tax in a certain tax area (country or state).
Create a Tax Rate¶
To create a new Tax Rate:
Navigate to Taxes > Taxes in the main menu.
Click Create Tax.
The following page opens:
Fill in Code, Description, and Rate (%).
Click Save on the top right of the page.
The new Tax Rate is created.
Export Tax Rates¶
You can export the tax rate details in the .csv format following the Exporting Bulk Items guide.
Import Tax Rates¶
You can import the bulk details of tax rate information in the .csv format following the steps described in the Importing Taxes guide.
More details on how to manage tax rates are described in the Taxes (Tax Rates) section.
Now that you have set corresponding tax rates, you need to create a tax rule that associates this tax rate or tax exemption (zero rate) with other tax components, such as customer tax codes, product tax codes, and tax jurisdictions.
Create a Tax Rule¶
Note
See a short demo on how to create tax rules in OroCommerce, or keep reading the step-by-step guidance below.
To create tax rules for a particular tax jurisdiction, you need to complete the configuration of the tax options described in the Tax Rule Prerequisites section.
Once all the necessary actions are performed, you need to create a tax rule for every valid combination of the tax rates, product types, and customer types to ensure that they are properly taxed at every check out.
Navigate to Taxes > Tax Rules and click Create Tax Rule.
Select a customer and a product tax codes in the respective fields.
Select a tax jurisdiction in the Tax Jurisdiction field and a tax rate in the Tax field.
Describe this tax rule if necessary in the Description field.
Click Save and Close.
Export Tax Rules¶
You can export the tax rule details in the .csv format following the Exporting Bulk Items guide.
Import Tax Rules¶
You can import the bulk details of tax rule information in the .csv format following the steps described in the Importing Tax Rules guide.
For more information on how to manage tax rules, refer to the Tax Rules section.
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