Solved: Why is Tax Applied differently between Add Tax to ...

bloodyrosebtq · ‎08-02-2017

When I set up my store I configured tax to "Include Tax in Price" and all my prices to whole numbers (i.e. 25, 28, 30, 50, etc.) No matter how many items are in a cart the final price is always a whole number total. For example, 28 + 28 = 56.

Since then I started a WooCommerce shop with Square as the payment processor. Woo does not like prices for items with "Include Tax in Price" set. Because of this I set Square to "Add Tax to Price" and I am re-entering all my prices. accordingly. So, an item that was $28 is now $25.87, a $5 item is now $4.62, etc. Now the Square shopping cart no longer has a final price that is a whole number. For example, 25.87 + 25.87 + 4.27 (tax) = 56.01.

How can I configure my prices in Square so that the prices with tax added are the same as the prices with tax included? I need 25.87 + 25.87 + 4.27 (tax) = 56.

Square Cart with Tax Added - final price = 56.01

Same Items with Tax Included - final price = 56.00

Woo Commerce Shop with Same Items, Tax Added - final price = 56.00

VanKalkerFarms · ‎08-02-2017

Because of rounding, you will have some trouble with this. It looks like your tax rate is 8.25%. Your example $25.87 item is taxed $2.134275 which rounds down to $2.13, making one item $28. When you have 2 items, however, the tax rounds up to $4.27. This gives you the extra penny on 2 items. I'm not sure how WooCommerce is rounding down unless it's calculating each item's tax separately and then adding them up instead of taxing the final total. I'm not familiar with Woo, so I can't suggest any ways to help on that end, but this is how the math works out.

Bob Van Kalker
My Van Kalker Farms Garden Center website
My Rise'n Roll Bakery Schererville Indiana Facebook Page
My Rise'n Roll Bakery Cedar Lake Facebook Page

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VanKalkerFarms · ‎08-02-2017

Because of rounding, you will have some trouble with this. It looks like your tax rate is 8.25%. Your example $25.87 item is taxed $2.134275 which rounds down to $2.13, making one item $28. When you have 2 items, however, the tax rounds up to $4.27. This gives you the extra penny on 2 items. I'm not sure how WooCommerce is rounding down unless it's calculating each item's tax separately and then adding them up instead of taxing the final total. I'm not familiar with Woo, so I can't suggest any ways to help on that end, but this is how the math works out.

Bob Van Kalker
My Van Kalker Farms Garden Center website
My Rise'n Roll Bakery Schererville Indiana Facebook Page
My Rise'n Roll Bakery Cedar Lake Facebook Page

bloodyrosebtq · ‎08-05-2017

I figured as much. This just makes synching the in-store and online store more difficult. Our in-store policy is to have prices that are whole dollar amounts, No change. If the Square online store was more flexible I'd just use that.

Why is Tax Applied differently between Add Tax to Price and Include Tax in Price