Tax settings

After setting up your store, you need to determine whether to configure tax settings for your store. This guide will walk you through how to set up taxes in Genstore.

Genstore supports two tax configuration methods, you can choose the one that best suits your business needs:

• Manual tax settings
• Automated tax settings

Manual tax settings

Manual tax configuration is suitable for businesses operating in regions where tax rates are relatively simple and stable. With this method, you must manually configure tax rates for each country or region where you collect taxes and update them whenever tax regulations change.

Configure tax collection regions

The first step in setting up manual tax settings is to add the countries or regions where you need to collect taxes. After adding them, you can configure tax rates for each region.

1. Navigate to Genstore -> Settings -> Taxes and duties.
2. Click Add country, then select the country or region where you want to collect taxes. Note: Previously added countries/regions cannot be selected again.
3. Click Edit to configure tax rates for the selected country.

Configure tax rates

National tax rate

If a country or region has a uniform tax rate, you can apply a single tax rate to all products sold in that country. The tax rate supports up to three decimal places.

Regional tax rates

If different regions within a country have varying tax rates, you can add specific regions and configure their respective tax rates.

1. Click Add, select the regions where you need to apply special tax rates, and click Save.
2. Enter the tax rate for each selected region. Note: Entering 0 means no tax will be collected.

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If regional tax rates are set, they will take precedence over the national tax rate. If no regional tax rate is configured, the national tax rate will apply.

Custom tax groups

If certain products require different tax rates, you can create a custom tax group.

For example, if alcoholic beverages require a different tax rate than other products, you can create a separate tax group and set a specific tax rate for them.

1. Click Add tax group.
2. Enter a tax group name.
3. Select the products for this group.
4. Configure either a countrywide or regional tax rate.
5. Click Save.

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Each product can belong to only one custom tax group per country/region. If a product has already been added to another custom tax group, you cannot select it again.

Shipping tax

If a country or region requires tax on shipping fees, you can enable shipping tax.

1. Click Add, then select the country or specific regions within the country.
2. Configure the tax rate for shipping fees in the selected country or region. Note: Entering 0 means no shipping tax will be collected.

Custom tax display name

You can customize the tax name displayed to customers at checkout. By default, the tax label is Tax. You can also add additional tax descriptions to help customers better understand how taxes are applied to their orders.

Automated tax settings

For countries with complex tax regulations, we recommend using Genstore's automated tax solution powered by Avalara, a third-party tax service provider. Once connected to Avalara, all tax calculations for your transactions will be managed automatically. You won’t need to determine when and where to collect taxes or how much tax to charge.

Set up and configure an Avalara account

Before using automated tax calculations, you must create an Avalara account. You can sign up on the Avalara.

If you already have an Avalara account, log in and verify that the following configurations are completed:

Set up your company and tax collection locations in Avalara

1. Log in to Avalara and navigate to Settings -> Manage companies.
2. Add your company details.
3. Go to Settings -> Where you collect tax.
4. Click Add countries where you report tax to configure tax collection locations.

Obtain your account license key

1. Log in to Avalara, then go to Settings -> License and API keys.
2. Click Generate new key to obtain your license key.

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If you have any questions regarding your Avalara account setup, please contact Avalara customer support.

Connect your Avalara account and configure automated tax settings

1. Enter your Avalara account credentials and the license key you generated.

2. Select the account environment:

   • Production: For live transactions.
   • Sandbox: For test in non-production environment. If you are unsure which environment to use, check with Avalara support.

3. Click Test connection to ensure the integration is successful.

4. Select the Tax calculation entity you configured in Avalara.

5. Choose your tax calculation method:

   • Tax only: Avalara calculates the tax but does not sync transaction records to your Avalara account.
   • Tax calculation and transaction reporting: Avalara calculates the tax and syncs transactions to your Avalara account, which is useful for tax reporting and audits.

6. Tax code mapping: To use automated tax calculations, your products must be mapped to the correct Avalara tax codes. Genstore allows you to map tax codes to product categories, so you don’t have to assign tax codes to individual products manually.

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   • Any products without an assigned tax code will be taxed at the highest default rate.
   • If you’re unsure which tax code to use, consult Avalara customer support.
   • Since product categories have multiple levels, ensure you assign tax codes at the correct level to avoid missing tax calculations.
   • For non-standard products that require taxation, use the Non-standard product tax code option. Currently, only Freight tax can have custom tax codes.

Enable automated tax calculation

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With automated tax calculation enabled, you must first disable it before adjusting configurations, such as the tax code associated with a product.

Once all settings are complete, click Turn on tax calculation to start using automated tax services. If you need to disable it, click Turn off tax calculation.

Additional settings

Configure tax-inclusive or tax-exclusive pricing

1. Navigate to Genstore -> Settings -> Taxes and duties.
2. Choose whether product prices should be tax-inclusive or tax-exclusive.
3. You can also configure whether shipping fees should include tax.

How tax is calculated

• Based on address Genstore calculates taxes using the customer’s shipping address for both manual and automated tax settings. Both self-pickup products and digital products, the billing address is used. Currently, merchants cannot modify this setting.
• Based on product price Genstore calculates taxes based on the discounted product price (Discounted product price = Product price - Product discount - Order discount). The order tax is the sum of all product taxes. Note: The portion paid with a gift card is not included in the deducted discount amount.

Tax rounding method

Genstore currently applies a product-level tax rounding principle, meaning that taxes are calculated individually for each product. The calculated tax amount is rounded to two decimal places, and the total tax amount is determined by summing the rounded values of all products.

Note: The decimal places for rounding are retrieved from Settings -> Market -> Preferences -> Price rounding by default. If you need to adjust this setting, please update it in this section.