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Taxes#

In most legislations, you are required to pay taxes for sales you make using pretix. pretix gives you the tools you need to calculate the appropriate tax for each sale. You are prompted to create one simple tax rule during event creation, which may already be enough for the most simple use cases. This article tells you how to create additional tax rules, how to configure complex custom tax rules, and how to assign them to products.

This article does not tell you what taxes are appropriate for your individual situation. This depends on your local legislation, the type of your business, and a number of other factors. The pretix documentation does not contain any information on the appropriate tax rates for your situation. Please speak to a professional tax consultant before setting tax rates in your shop.

Warning

The pretix Documentation is not legal or financial advice. Please consult a tax advisor before setting the tax rules for your shop. We do not assume any liability for the correct handling of taxes in your ticket shop.

Prerequisites#

Taxes are handled on the event level, so you have to create an event first.

General usage#

pretix allows you to set up a tax rule for each tax rate that is relevant for your situation. Then, you assign that tax rule to each individual product. If you are selling products with a 0.00% tax rate (such as gift cards), you still need to create a 0% tax rule first.

When it comes to tax rules for free products, the only material difference is the tax rate printed on the invoice. Create and assign the tax rule that you want to see on the invoice. By default, pretix will not create invoices for orders that only contain free products.

Creating tax rules#

In order to create a new tax rule, navigate to navigation pathYour event then Settings then Tax rules. This page displays a list of all tax rules that have been created for the event. To create a new tax rule, click the Create a new tax rule button.

Tax rule dialog. The 'General' tab is open, displaying options for official and internal name, tax rate, and whether to include the tax in the product price.

This takes you to a dialog for creating the new tax rule. On the "General" tab, choose an "Official name" that will be displayed to customers in your shop. Provide a translation for each language you are using.

Optionally, you may choose an "Internal name" that will only be displayed in the backend.

Under "Tax rate", choose a rate in percent. For example, if your products are sold with the regular value-added tax rate in Germany, set the "Tax rate" to 19%.

The box next to "The configured product prices include the tax amount" determines whether the price of a product with this tax rule is handled as its net price (before tax) or its gross price (after tax).

By default, this box is checked, so all product prices with this tax rule are handled as gross prices (tax is included in the price). This means that a product with a listed price of €10.00 and a tax rate of 19% has a net price of €8.40, €1.60 worth of value-added tax, and a total gross price of €10.00.

If you uncheck this box, all product prices with this tax rule are handled as net prices (tax is added on top of the listed price). A product with a price of €10.00 and a 19% tax rule will have €1.90 worth of taxes added on top of the net price, leading to a gross price of €11.90. This setting applies to all products that use this specific tax rule. It does not apply to all products in your shop.

Click the Save button once you are happy with your choices.

Custom tax rules#

Tax rule dialog. The 'Advanced' tab is open, displaying options for EU reverse charge, merchant country, and adding new custom rules.

Note

Using custom tax rules is mutually exclusive with the EU reverse charge option. If you have defined one or more custom tax rules, then the EU reverse charge taxation rule will not apply, even if the box next to "Use EU reverse charge taxation rules" is checked.

pretix allows you to set "custom rules" if you have special requirements for the conditions in which VAT will or will not be charged. These "custom rules" are subordinate to a tax rule and optional.

If you want to use custom rules specific to businesses with VAT IDs, you have to ask your customers for their VAT ID. Navigate to navigation pathYour event then Settings then Invoicing. Switch to the Address form tab and make sure that the boxes next to "Ask for invoice address" and "Ask for VAT ID" are checked. Click the Save button to confirm.

In order to set custom tax rules, navigate to navigation pathYour event then Settings then Tax rules. Click the tax rule for which you want to set custom rules, switch to the Advanced tab and click the Add a new rule button.

In the first dropdown menu, select the country or territory where the custom rule will apply or select "Any country". In the second menu, select the type of customer (individual, business, or business with valid VAT ID) or select "Any customer".

In the third dropdown menu, select the action to be taken under the specified conditions (country and customer). You may select "Charge VAT" and then specify a "Deviating tax rate" in the input field below. You may also select a different option and leave the field empty.

When a customer places an order, pretix will check the custom rules from top to bottom. The first rule matching the order will be used to decide if and how VAT will be charged. You can move the rules up or down the priority list using the arrow buttons and .

Tax rule dialog. The 'Advanced' tab is open, displaying four custom rules, as described in the paragraph below.

For illustrative purposes, let us assume an event hosted by a company in Germany which is eligible for EU reverse charge. Such a company might first create a rule for "Germany", applying to "Any customer" the action "Charge VAT". It might then create a rule for "European Union", applying to "Business with valid VAT ID" the action "Reverse charge".

It might then create a rule for Austria, applying to "Any customer" the action "Charge VAT" with the deviating tax rate set to the VAT rate of the country in question. It might then create the same rule for every single member state in the EU from Belgium to Sweden, always setting the appropriate deviating tax rate. Finally, the company might create a rule for "Any country", applying to "Any customer" the action "Charge VAT".

In this example, if a company located in Austria with a valid VAT ID places an order, this matches both the second and the third rule. However, since custom rules are always checked top to bottom and only the first matching rule is applied, only the only the second rule from our list (Austria → "Any customer" → "Charge VAT") will be applied to the transaction. The order in which rules are arranged here also ensures that no business from an EU country outside of Germany will be charged VAT on their transaction, as long as they provide a valid VAT ID while placing their order.

The example case described above is for illustrating the use of the software only; it does not constitute legal advice.

EU reverse charge#

Warning

Reverse charge rules are not applicable to most events handled with pretix. We therefore strongly recommend not to enable this feature if you do not have a specific reason to do so. According to article 52 of the VAT directive (page 17), the place of supply is always the location of your event. Therefore, tax always has to be paid according to the laws of the country where the event is held, regardless of the location of the customer.

Note

The EU reverse charge feature is deprecated. It will be removed in a future version of pretix. Avoid using EU reverse charge if possible and define custom tax rules instead. That way, you can tailor taxation rules to your individual use case and make sure you are complying with all relevant laws.

Note

Using custom tax rules is mutually exclusive with the EU reverse charge option. If you have defined one or more custom tax rules, then the EU reverse charge taxation rule will not apply, even if the box next to "Use EU reverse charge taxation rules" is checked.

"Reverse charge" is a rule in European Union VAT legislation that specifies how taxes are paid if the seller and buyer of a good reside in different EU countries. If the buyer is registered as a VAT-paying business in their country, you charge them only the net price without taxes and state that the buyer is responsible for paying the correct taxes.

If you want to use reverse charge, you have to ask your customers for their VAT ID. Navigate to navigation pathYour event then Settings then Invoicing. Switch to the Address form tab and make sure that the boxes next to "Ask for invoice address" and "Ask for VAT ID" are checked. Click the Save button to confirm.

If you want to enable reverse charge, navigate to navigation pathYour event then Settings then Tax rules. Select the tax rule for which you want to enable reverse charge and switch to the Advanced tab. Check the box next to "Use EU reverse charge taxation rules" and select your country from the "Merchant country" dropdown menu.

If you enable the reverse charge feature and specify your merchant country, then the following process will be performed whenever an order is placed:

  1. The customer is presented with net or gross prices, as configured for the applicable tax rule.
  2. The customer adds a product to their cart. The shop displays gross prices including taxes.
  3. In the "Your information" step, the customer can enter their "Invoice information". Tax will be removed from the price if one of the following statements is true:
    • The invoice address is in a non-EU country.
    • The invoice address is a business address in an EU-country different from the merchant country and has a valid VAT ID. In this case, a reverse charge note will be added to the invoice.

VAT IDs are validated against the EU's validation web service when the customer clicks the "Continue" button. If the service is unavailable at that moment, then the customer has to pay VAT tax and reclaim the taxes with their government at a later point.

If your and your buyer's EU countries use different currencies, the invoice will include the total and VAT amount in the local currency of the buyer in addition to your event's currency.

For existing orders, a change of the invoice address will not result in an automatic change of taxes. If you want to trigger this manually, navigate to navigation pathYour event then Orders then All orders and click one of the orders in question. Click the Check button next to the VAT ID. Then, click the Change products button. Under the "Other operations" heading, select one of the options next to "Recalculate taxes". Confirm your choices by clicking the Perform changes button.

Note

Modifying tax status back and forth may introduce rounding errors of up to one cent from the intended price. This is unavoidable due to the flexible nature in which prices are being calculated.

Assigning tax rules#

Create product dialog. The last option is a dropdown menu labeled 'Sales tax'. The current selection is 'No taxation'. At the bottom of the page, there is a button labeled 'Save and continue with more settings'.

If you want to assign a tax rule to a new product you are creating, navigate to navigation pathYour event then Products then Products. Click the Create a new product button. Under the "Price settings" subheading, click on the "Sales tax" drop-down menu and select the tax rule that you want to assign to the product. This list will use the internal name you specified on the tax rules settings page and the specified percentage. Once you have made your selection, click the Save and continue with more settings button.


Edit product dialog. The 'Price' tab is open. The second option is a dropdown menu labeled 'Sales tax'. The current selection is 'VAT (incl- 19.00% VAT)'. At the bottom of the page, there is a button labeled 'Save'.

If you want to assign a tax rule to an existing product, navigate to navigation pathYour event then Products then Products. Click the edit button next to the product in question and switch to the Price tab. In the "Sales tax" drop-down menu, select the tax rule that you want to assign to the product. This list will use the internal name you specified on the tax rules settings page and the specified percentage. Once you have made your selection, click the Save button.

Troubleshooting#

International business customer places order without VAT ID#

If an international business customer places an order without giving you their VAT ID, you can manually edit the order in question. On the "Order details" page, click Change answers. Under "Invoice information", select "Business or institutional customer". The page will now display a "VAT ID" field where you can enter the customer's VAT ID.