Value Added Tax (VAT)

Order Management supports different types of taxation policies, including sales tax and value added tax (VAT). Sales tax is the tax paid on products and services in countries such as the United States and is quoted separately from an item price. VAT is an indirect sales tax paid throughout the European Community and European Free Trade Association (EFTA), among other nations, but not the United States. Unlike sales tax, VAT is included as part of the item price. VAT rates vary by country or region. The VAT authorities of individual countries decide on the rates to be imposed on different goods and services. In addition, there are also certain rules for specific products and services. VAT appears in the currency of the locale.

Note: In Canada, three types of sales taxes are levied: Provincial sales taxes (PST), levied by the provinces. Goods and Services Tax (GST), a value-added tax levied by the federal government.

Order Management shows VAT and sales tax information at the line item and order level. To control this display, configure the taxation policy in merchant price books in Salesforce B2C Commerce. The taxation policy determines whether product and service prices are treated as net or gross prices. This treatment affects the display of prices and tax amounts in the Order Management user interface as follows:

Example

Domestic U.S. sales use the net policy, where a customer service representative (CSR) refers to a price plus tax. European sales use the gross policy, where a CSR would quote a price inclusive of tax. For example, if an item costs $10 plus 5% sales tax, a U.S. CSR would say that "the price is $10 plus tax." When describing a similar item that costs 10 Euros plus 5% VAT, a European CSR would say that "the price is 10.50 Euros."

Tax processing

Tax Processing

Order Management retrieves pricing and VAT or sales tax details from B2C Commerce for Website orders. When creating an order, adding an item, or exchanging an item, the pricing and VAT or sales tax details are retrieved via web service calls.

For price changes, appeasements, returns, or cancellations, the item price, tax, and promotion data are not retrieved from B2C Commerce. In these cases, taxes are calculated and prorated based on the price and tax data that was stored when the order was captured. For a price change or appeasement, the CSR can manually adjust the tax amount based on the price adjustment.

User interface pages and customer-facing documents, such as invoices, quotes, emails, and templates, show the price and tax values according to the taxation policy. When customizing templates, the item extended price, shipping costs, handling costs, subtotal, and tax amount can be shown.

When browsing items in Customer Service Center, the Item Price field is calculated as follows:

When browsing items under gross tax policy in Customer Service Center, the item detail doesn't indicate that tax is included in the shown price. The CSR must be aware of the tax policy.

The following considerations are important.

Scenarios: Value Added Tax (VAT)

Scenario: create and view item and order details in Customer Service Center when VAT is used
A customer in France calls to place an order that consists of two dresses and two books. Both items come from the same merchant. Both items are gift wrapped. Because VAT is used for product and service taxation in France, the item prices include VAT. The customer service representative (CSR) must add the items to the cart from the appropriate merchant catalog. As each item is added, the item price and VAT information are retrieved from B2C Commerce. The CSR must review the item and order-level details with the customer.
Action
The CSR performs the following steps to process the customer order, which uses VAT:
  1. In Order Management Customer Service Center, click New Order.
  2. On the order entry page, search for and locate the customer.
  3. Click the Info tab and select the currency (Euros) and locale (French – France) for the order.
  4. Click the Cart tab and add the items to the cart. The item prices retrieved from B2C Commerce are shown. The item price includes the VAT and duties.
  5. Click the Shipping tab and select the shipping method, which shows the shipping cost that was retrieved from B2C Commerce.
  6. Click the Payments tab and select the payment method.
  7. Click the Review tab on the Order details page and review the Item and order details with the customer. For each item reviewed, specify that taxes are included in the item price. For the subtotal of the order, specify the following:
    • Subtotal: total price of all items including price adjustments + tax, but without shipping or handling
    • Price Adj: total of order-level price adjustments
    • Shipping: total shipping amount + tax on the shipping
    • Handling: total handling amount + tax on the handling.
      Note: The gift wrap cost is included in the handling cost.
    • Tax: shows the word "Included" instead of the tax amount.
    • Order total: subtotal extended price - total order price adjustments + total shipping + total handling.
  8. To submit the order, click Submit Order.
The item and order-level price and tax information are also shown on the invoice, emails, pack slip, and any other customer-facing documents.

See Creating New Sales Orders in Customer Service Center.

Scenario: retrieve VAT amount after a promotion is applied
A customer in France calls to place an order and uses a _15% off your order_ promotion. The CSR expects that Order Management retrieves the pricing, shipping, and VAT information from B2C Commerce and adjusts the price and tax to reflect the promotion.
Action
The CSR performs the following steps to process the customer order, which uses VAT:
  1. In Order Management Customer Service Center, click New Order.
  2. On the order entry page, search for and locate the customer.
  3. Click the Info tab and select the currency (Euros) and locale (French – France) for the order.
  4. Click the Cart tab and add the items to the cart. The item price retrieved from B2C Commerce is shown. The item price includes the VAT and duties.
  5. Enter the promotion code. B2C Commerce validates it.
  6. Click the Shipping tab and select the shipping method, which shows the shipping cost that was retrieved from B2C Commerce.
  7. Click the Payments tab, select the payment method.
  8. From the Review tab on the Order details page, and review the Item and order details with the customer. Confirm that the price and tax amounts were adjusted to reflect the promotion discount.
The item and order-level price and tax information also appear on the invoice, emails, pack slip, and any other customer-facing documents.

Related Links

Multiple Currencies

X Privacy Update: We use cookies to make interactions with our websites and services easy and meaningful, to better understand how they are used and to tailor advertising. By continuing to use this site you are giving us your consent to do this.