Properly configuring taxes ensures compliance and accurate pricing for your customers. This guide walks you through WooCommerce tax setup.
Enable Taxes
- Go to WooCommerce > Settings > General
- Check Enable tax rates and calculations
- Click Save changes
A new Tax tab will appear in Settings.
Configure Tax Options
Go to WooCommerce > Settings > Tax:
- Prices entered with tax: Choose whether your product prices include tax or not
- Calculate tax based on: Customer shipping address, billing address, or shop base address
- Shipping tax class: Apply tax to shipping costs
- Display prices in shop: Including or excluding tax
- Display prices during cart and checkout: Including or excluding tax
Set Up Tax Rates
- Click Standard rates tab
- Click Insert row
- Fill in the details:
- Country code: 2-letter code (e.g., US, GB, DE)
- State code: State/province code (leave blank for entire country)
- ZIP/Postcode: Specific codes or ranges (optional)
- City: Specific cities (optional)
- Rate %: Tax percentage
- Tax name: Label shown to customers (e.g., Sales Tax, VAT)
- Compound: Apply on top of other taxes
- Shipping: Apply to shipping costs
- Click Save changes
Example: US Sales Tax
| Country | State | Rate | Name |
|---|---|---|---|
| US | FL | 6.0000 | FL Sales Tax |
| US | CA | 7.2500 | CA Sales Tax |
| US | NY | 8.0000 | NY Sales Tax |
Example: EU VAT
| Country | Rate | Name |
|---|---|---|
| DE | 19.0000 | MwSt |
| FR | 20.0000 | TVA |
| GB | 20.0000 | VAT |
Reduced Rate and Zero Rate Classes
Some products may qualify for reduced or zero tax rates. Configure these in the Reduced rate rates and Zero rate rates tabs.
Tax Plugins for Complex Needs
- WooCommerce Tax: Free automated tax calculation for US stores
- TaxJar: Real-time sales tax calculation and filing
- Avalara: Enterprise tax compliance
Important: Consult a tax professional to ensure you are collecting the correct rates for your business.