Getting started
How VAT is calculated
When the app uses the tax Shopify charged, when it uses your Default VAT rate, and how shipping is handled.
Each line on an invoice has a VAT rate and a VAT amount. The app takes them from two places: the tax Shopify charged on the order, and the VAT settings on the Settings page.
Products
| What Shopify did | VAT amount on the invoice | VAT rate on the invoice |
|---|---|---|
| Charged tax on the product | The tax amount Shopify charged | Your Default VAT rate |
| Charged no tax on the product | Calculated by the app from the Default VAT rate | Your Default VAT rate |
When the app calculates VAT itself, it follows the All prices include tax setting in Shopify (Settings > Taxes and duties):
- On. The product price already contains VAT. The app splits it into the price before VAT and the VAT amount. A 110,000₫ product at 10% becomes 100,000₫ + 10,000₫ VAT.
- Off. VAT is added on top of the product price. A 100,000₫ product at 10% becomes 100,000₫ + 10,000₫ VAT.
Most stores in Vietnam don't collect tax in Shopify and enter prices that include VAT. For those stores, the Default VAT rate decides the VAT on every invoice.
If you collect tax in Shopify
- Set the Default VAT rate to the rate you use in Shopify. The VAT amount comes from Shopify, but the rate printed on the invoice comes from this setting. If Shopify charges 8% and the Default VAT rate is 10%, the invoice shows 10% next to an 8% amount.
- Tax-exempt products still get the Default VAT rate. A product Shopify charged no tax on is treated the same as a store without tax, so the app adds VAT at the Default VAT rate. Issue these orders manually in your provider account if the product is exempt.
- All products should use one VAT rate. An invoice uses a single rate for its product lines.
Shipping
The app always calculates shipping VAT itself. It does not use the shipping tax Shopify charged.
- By default, shipping uses the Default VAT rate and follows All prices include tax, the same as products.
- With Customize shipping VAT on, shipping uses its own Shipping VAT mode and Shipping VAT rate. Turn off Include shipping on the invoice to leave shipping off the invoice.
Adjustment invoices
Adjustment invoices use the Default VAT rate, with the amount you enter treated as including VAT.
KCT and KKKNT
Not subject to VAT (KCT) and No VAT declaration required (KKKNT) have no equivalent in Shopify. Choose them in the app when your business sells goods that fall under these categories. The app then adds no VAT. Don't collect tax in Shopify for these goods.