Zen 1.57c and going VAT registered, is there a zen to do list for this?

Given recent changes in the tax laws and upgrade of zencart, it would seem the topics are outdated that may have been helpful...

Has anyone recently gone VAT registered that can assist me in working out how to do it, I probably have a week or so until my VAT number arrives. I'm not over the threshold yet, but to keep my main supplier after april it needed to be done. I know I need to change lbs to kg but that's another job for another day :)

My main issue is that I have around 5-7k items listed and I will need zencart to say VAT not TAX during checkout, to update all those items would be a long winded job. I am guessing I would need to create an sql to mass update everything on the day the number appears?

I'm not a coder which usually makes it hard to make big changes like this and depending on how complex it is I will possibly have to get someone to do this for me but i'm unsure of the best way/don't want to miss anything during the changeover. A checklist would be awesome if anyone can help

lbs to kg is a simple change in the files: includes/languages/english.php - simply search for lbs and change the 2 lines to read kg. Keep in mind there might be a template override so you might need to change another file or two.

If your site already says "tax", it means your products ARE set as taxable goods so it's just a matter of changing the wording which is in includes/languages/english/modules/order_total/ot_tax.php

I'm assuming all of your orders will include VAT, meaning there are no customers who buy VAT-free, and then they can claim VAT afterwards. If so, you're worry free. Don't forget your accounting will be quite a nightmare if you're selling EU-wide because VAT needs to be declared to each country... Your accountant should know more, I remember I hated it...

yeah all will be vat inclusive orders but at the moment every item is setup as 0% tax as im not registered just yet, it's due anyday though. Is there an easy way to set everything to change to 20% tax without adding 20% onto the price? There is only a few items I would have to do the maths on to double check the pricing point I have works. A setting change on my suppliers website for computing items will possibly be needed too so the prices import correctly

You'll need a Zone where your VAT is applicable and you'll need to create a Tax Class and a Tax Rate.
#1 go to Locations->Zones Definitions and create a zone for VAT. Add countries where you will charge VAT. If it's worldwide, set to "All Countries" and "All zones".
#2 Now, for tax. You can use/edit the existing ones if you haven't deleted them. Check Locations->Tax Classes and see if you still have "Taxable Goods". If not create it and take note of the ID shown. Then go to Locations->Tax Rates and either edit the existing one or create a new one. Set it to "Taxable Goods", set the Zone where it applies (as defined in previous step) and set the tax rate. One thing I used to do with my UK clients was set it to 19.999% because it had proven to return much better calculations and there were less errors due to rounding.

Once it's all done, you'll need to run some SQL queries to update pricing. Go to Tools->Install SQL Patches and run the following:

UPDATE products SET products_tax_class_id = 1;

This query will update ALL products and make it Taxable Goods. Keep in mind that you need to use the ID that you took note of in step 2.
Next, run this:

UPDATE products SET products_price = products_price * 5 / 6;

This will convert your current prices to Net prices and once tax is added, the price will remain the same. For example, if your current price is £100 and you want to keep it £100 with VAT included, it's gonna be 100*5/6 = £83.33 + 20% VAT = £100
For anyone else reading this: your values might be different in the formula - this is based on 20% tax.

Don't forget to change your store's settings in Configuration->My Store->Display Prices with Tax->true and optionally the same for admin.

Oh, and one VERY IMPORTANT THING - when you get to Tools->Install SQL Patches, you'll see the text in red. Make sure you read it and do what it says. :wink:

balihr has outlined this perfectly. Bear in mind that if you sell to Channel Islands, VAT is not applicable, so while Channel Islands are considered "UK territory", they are not subject to UK VAT. So, a "tax zone" would also be needed for Channel Islands, to include Jersey & Guernsey.
From a business point of view - suddenly being accountable for VAT means an instant 20% hit on your bottom line, so if you maintain prices, then your quarterly revenue will be 20% lower as you need to pay the VAT quarterly. If your store is principally retail (to consumers) your DISPLAYED prices MUST include VAT on all products where VAT is applicable. So your settings in configuration must be prices shown include tax.
I generate invoices and order confirmations to show VAT breakdowns on orders, because some of my customers are companies, who need a VAT invoice - but DISPLAYED prices are inclusive of VAT.
Remember too, that postage/dispatch is subject to vat as well - even though most of Royal Mail's postal prices are zero-rated. So even if you send something with a 2nd-class stamp @ £0.75, you need to add VAT to that £0.75.
Bearing in mind that upon your accountability for VAT, your revenue suddenly becomes 20% less, it is a good idea to increase prices (perhaps not by 20% initially) so that the hit on your balance sheet is not so devastating. You will have to "guess" at what your market may tolerate in terms of price increases... When I became VAT accountable, I put everything up 10%, and over the ensuing months added a couple of percentage points to prices to eventually account for VAT liability. I lost some customers initially, but this was better than taking the full 20% hit in the short-term.
Look for other ways to cut costs in the short term. Not easy in our inflationery economy right now, but "every little helps".

It seems like something I should be able to sort out myself after seeing the to do list. Thankyou Balihr :)

And agreed my prices will need to rise eventually for most items schoolboy, however I compete with VAT registered businesses who often sell for the same price the spplier charges once vat is applied. I believe our toys suppliers are forcing the vat registered issue so they can help restore the retail price on pokemon items. The R.R.P increased from 3.99 to 4.29 on a pack but the booster boxes can easily be found from genuine sellers at almost cost price for the latest set. This has been an issue thats been developing over the last few months to the point a product with retail price of around £155 and customers believing that the retail price is around £100! :/

can i also add to this don't forget when you register for VAT in the UK you can claim all your VAT you have paid in the past 3 months, as long as you still have then and must be still using them and before you ask no you will not be liable to pay the VAT that would of been charged on the sales if you had of been registered for VAT. so get all your supplier invoice and bills and receipts inc utility's for the business out and claim it back on your first submission or with good reason your second, trust me this will help you out big time as this can be near a £1000, even more so if you had a big stock order before registering.
P.s hope you got a company car within last 3 month before.

OJ_SIMON:

can i also add to this don't forget when you register for VAT in the UK you can claim all your VAT you have paid in the past 3 months, as long as you still have then and must be still using them and before you ask no you will not be liable to pay the VAT that would of been charged on the sales if you had of been registered for VAT. so get all your supplier invoice and bills and receipts inc utility's for the business out and claim it back on your first submission or with good reason your second, trust me this will help you out big time as this can be near a £1000, even more so if you had a big stock order before registering.
P.s hope you got a company car within last 3 month before.

and yes this includes the VAT paid on cost of sales made within the past 3 months.

OR.. you can claim back everything since date of incorporation for things like all this stock i have built up :) I can't get a company car or i'd definetly be at a dealership right now. I'm only registering because i need too if i want too keep my supplier.

Just had a customer ask why my vat number isn't on my invoice my site generated.. is there anything i can do about that folks??

In Australia we are required to have our ABN (Australian Business Number) on the invoice.
I have this as the last line in the Store Address and Phone setting under admin > my store >Store Address and Phone. When the address is on the invoice it is always included.

OldNGrey:

In Australia we are required to have our ABN (Australian Business Number) on the invoice.
I have this as the last line in the Store Address and Phone setting under admin > my store >Store Address and Phone. When the address is on the invoice it is always included.

I love how simple this solution is, that's one of those obvious solutions you only realise when someone says it to you. Thankyou very much 👌

One more issue I am encontering with my vat setup... zxpos, create an order and take payment... invoice states slightly incorrect price? for example, pokemon pack is £4.29 each, if i sell 1 pack it records the order value as £4.30??

I only seem to get the issue within zxpos, only setting i see in admin panel that could potentially yield a resolution is "apply padding to tax" which is currently set to "0" but there is no explanation for the setting other than "adjusts tax calculation by decimal places" and i'm looking at it wondering "ok, and if i want to change this what do i enter? extra 0's and an actual decimal point, maybe 0.00 is correct?"

Anyone had a similar issue or know if this setting is the solution/how i edit it correctly??