Shipping Band VAT Related Problem

[ShinyHappySimon]

Hello,

Apologies if this has been discussed elsewhere, I had a good search but my brain started to feel funny.

We have shipping set so orders under £30 (25.53+VAT) are charged £3.50 (2.98+VAT) and over £30 are charged £6.50 (5.53+VAT).

OK here is my problem, because some of our products are zero rated (books, etc..) they are throwing my shopping cart off kilter.

For example:

Item 1 (VAT at 17.5%): £7.99 (6.80+VAT)
Item 2 (VAT at 0%) : £19.99
TOTAL : £27.98 (26.79+VAT)

This attracts the £6.50 charge even though the actual cart value is under £30 which I would really rather didn't happen

I don't think it's possible to have the postage based on post-VAT cart values.

Any suggestions would be appreciated, VAT related problems make me sad

[dmalani]

Hi Simon

Try adjusting the Tax Rounding within Business Setting | Tax.

[Mike Hughes]

There is a problem here as the shipping calculation is based on the ex-vat price, so VAT free items will upset the assumption that £25.53 of ex-vat goods is the same as £30 inc VAT.

There really isn't any way around it. Certainly changing the VAT rounding will make no difference.

Can I suggest that you re-think your shipping charges? Most companies want to encourage people to buy more, but your policy is the opposite. i.e. you're actually discouraging people from adding more items to the cart.

Your policy = "I have two items in the cart already, but if I buy another one it's going to cost me another £3 in shipping. I'll just wait and maybe order it another time when I can think of something else to buy."

Most etailers who understand this will offer at least a 'neutral' shipping policy with a flat charge, or a positive shipping policy along the lines of 'free shipping on all orders over £30'.

This at least would get rid of the VAT problems.

Mike