Taxation based on Bill To versus Ship To
The Tax based on: options determine when iMIS does not charge VAT:
| Bill to data | Ship to / Recipient data |
|---|---|
| - Billing address is outside of the EU - Billing contact is *VAT Exempt* - Billing contact is *VAT registered* in a different EU country from the order's *financial entity* | - Shipping address is outside of the EU - Recipient contact is *VAT Exempt* - Recipient contact is *VAT registered* in the same country as the shipping address, and the shipping address is a different EU country from the order's *financial entity* |
Definitions:
- All orders have an associated financial entity, defined through System Setup > Organization Names. Each financial entity specifies a VAT Country.
- VAT Exempt means having the VAT Exempt option enabled on the contact's VAT tab (Customers > Manage customers).
- VAT registered requires having a VAT Registration Number specified on the contact's VAT tab. If so, whether a contact is VAT registered then depends on the tax method and the value in VAT Country:
- Bill to Data: if VAT Country is blank, the contact is VAT registered in the VAT Country of the order’s financial entity. (Exception: Web orders honor the original iMIS VAT implementation by first trying to establish the order’s financial entity from product lines.)
- Ship to / Recipient data: if VAT Country is blank, the contact is not VAT registered.
Here is a table that shows how VAT taxes apply to orders according to each Tax based on setting. You can substitute your EU countries for the ones used here (GB - Great Britain, BE - Belgium).
