Tax & VAT Guide
PayRequest provides comprehensive tax handling for businesses of all sizes. Whether you’re collecting Dutch BTW, EU VAT, or dealing with international tax exemptions, this guide covers everything you need to know.Overview
Automatic Calculations
PayRequest automatically calculates taxes based on your product settings, customer location, and tax exemption status.
EU VAT Compliant
Built-in support for EU VAT rules including reverse charge mechanisms for B2B transactions.
Flexible Display
Choose how prices are displayed to customers - with tax included or shown separately.
Customer Exemptions
Easy-to-manage tax exemption status for B2B customers and qualifying organizations.
Setting Up Your Tax Configuration
Step 1: Configure Business Tax Settings
Navigate to Settings > Tax & Currency to configure your business-wide tax defaults.1
Enable VAT Registration
Toggle VAT Registered if your business is registered for VAT/BTW. This enables tax collection features across your account.
2
Set Default Tax Rate
Enter your default tax rate (e.g., 21% for Dutch BTW high rate). This rate will be applied to new products automatically.
3
Specify Tax Region
Select your business location (NL for Netherlands, or your EU country code). This affects how taxes are calculated for international customers.
4
Enter Your VAT Number
Add your official VAT/BTW registration number. This appears on invoices and enables VAT validation features.
Your default tax settings serve as templates for new products. You can always override these on individual products.
Step 2: Configure Product Tax Settings
Each product can have its own tax configuration. Go to Products > Edit Product to adjust:| Setting | Description | Example |
|---|---|---|
| Tax Rate | The percentage of tax to apply | 21%, 9%, 0% |
| Tax Included | Whether the displayed price includes tax | Yes (recommended) |
Understanding Tax Included vs Excluded
Understanding Tax Included vs Excluded
Tax Included (Recommended for B2C)When enabled, the price you set is the final price customers see. Tax is calculated backwards from this price.
- Price set: €121.00
- Tax rate: 21%
- Net amount: €100.00
- Tax amount: €21.00
- Price set: €100.00
- Tax rate: 21%
- Tax amount: €21.00
- Total: €121.00
Step 3: Configure Shop Tax Display
Control how prices appear in your shop. Go to Settings > Shop and find the Tax Display setting:- Inclusive (Default)
- Exclusive
Prices show the final amount including tax.Customer sees:Best for: B2C businesses, consumer-facing shops
Dutch BTW (VAT) Rates
PayRequest supports all Dutch BTW rates:| Rate | Name | Common Use Cases |
|---|---|---|
| 21% | High Rate (Algemeen tarief) | Most goods and services |
| 9% | Low Rate (Verlaagd tarief) | Food, books, medications, hotels |
| 0% | Zero Rate (Nultarief) | Exports, intra-EU B2B supplies |
Tax Exemptions for Customers
Some customers may qualify for tax exemption, such as:- B2B customers with valid EU VAT numbers
- Non-profit organizations
- Government entities
- Export customers outside the EU
Marking a Customer as Tax Exempt
1
Open Customer Profile
Navigate to Customers and select the customer you want to mark as exempt.
2
Enable Tax Exemption
In the customer details, toggle Tax Exempt to enabled.
3
Document the Reason
Add a note explaining why this customer is tax exempt (e.g., “Valid EU VAT number verified” or “Non-profit organization”).
What Happens When a Customer is Tax Exempt?
When you create invoices or process orders for tax-exempt customers:- All tax rates are automatically set to 0%
- Invoice line items show “BTW VERLEGD” (Tax Reversed)
- The invoice total excludes tax
- Cart and checkout calculations reflect zero tax
Tax exemption status is checked automatically at checkout. Exempt customers always see tax-free prices.
Bulk Tax Exemption Updates
Need to update multiple customers at once? Use the Bulk Actions feature:- Go to Customers
- Select multiple customers using checkboxes
- Click Bulk Actions
- Choose Toggle Tax Exempt
EU VAT Rules
PayRequest implements standard EU VAT rules for cross-border transactions:B2C Sales (Business to Consumer)
| Your Location | Customer Location | Tax Applied |
|---|---|---|
| Netherlands | Netherlands | Dutch BTW (21%) |
| Netherlands | Other EU Country | Dutch BTW (21%)* |
| Netherlands | Outside EU | 0% (Export) |
B2B Sales (Business to Business)
| Your Location | Customer Location | Tax Applied |
|---|---|---|
| Netherlands | Netherlands | Dutch BTW (21%) |
| Netherlands | Other EU Country with VAT | 0% (Reverse Charge) |
| Netherlands | Outside EU | 0% (Export) |
About Reverse Charge (BTW Verlegd)
About Reverse Charge (BTW Verlegd)
When selling B2B to customers in other EU countries who have a valid VAT number, the reverse charge mechanism applies:
- You charge 0% VAT on the invoice
- The invoice shows “BTW VERLEGD” or “VAT Reverse Charge”
- The customer accounts for VAT in their own country
- You must verify the customer’s VAT number is valid
- Mark the customer as Tax Exempt
- Store their EU VAT number in the customer profile
- Add a note confirming VAT number validation
Supported EU Countries
PayRequest recognizes all 27 EU member states:View Full Country List
View Full Country List
| Code | Country |
|---|---|
| AT | Austria |
| BE | Belgium |
| BG | Bulgaria |
| HR | Croatia |
| CY | Cyprus |
| CZ | Czech Republic |
| DK | Denmark |
| EE | Estonia |
| FI | Finland |
| FR | France |
| DE | Germany |
| GR | Greece |
| HU | Hungary |
| IE | Ireland |
| IT | Italy |
| LV | Latvia |
| LT | Lithuania |
| LU | Luxembourg |
| MT | Malta |
| NL | Netherlands |
| PL | Poland |
| PT | Portugal |
| RO | Romania |
| SK | Slovakia |
| SI | Slovenia |
| ES | Spain |
| SE | Sweden |
Tax on Invoices
How Tax Appears on Invoices
Your customers see a clear tax breakdown on every invoice:Per-Line Tax Rates
Different products on the same invoice can have different tax rates:Setup Fees and Tax
Setup fees are taxed at the same rate as their parent product. If a product has:- Price: €50.00/month at 21% BTW
- Setup fee: €100.00 (named “Borg” or “Installation Fee”)
Setup fees with custom names (like “Borg” or “Onboarding Fee”) appear with their custom name on invoices, making it clear what the customer is paying for.
Tax in the Shopping Cart
During checkout, customers see a complete tax breakdown:
- Individual product prices
- Setup fees (if applicable)
- Custom field markups
- Tax amount calculated
- Total including tax
Common Tax Scenarios
Selling to Dutch Consumers (B2C)
Selling to Dutch Consumers (B2C)
Setup:
- Tax Rate: 21%
- Tax Included: Yes
- Customer: Not tax exempt
Selling to Dutch Businesses (B2B)
Selling to Dutch Businesses (B2B)
Setup:
- Tax Rate: 21%
- Customer: Regular Dutch business (not exempt)
Selling to EU Business with VAT Number
Selling to EU Business with VAT Number
Setup:
- Customer: Marked as Tax Exempt
- Customer’s EU VAT number recorded
Selling Outside the EU
Selling Outside the EU
Setup:
- Customer country: Outside EU (e.g., USA, UK)
- Customer: Should be marked as Tax Exempt
Selling Reduced-Rate Products
Selling Reduced-Rate Products
Setup:
- Product Tax Rate: 9%
- Examples: Books, food, medications
Best Practices
Verify VAT Numbers
Always validate EU VAT numbers before applying tax exemption. Use the VIES VAT validation service.
Document Exemptions
Keep records of why each customer is tax exempt. Add notes to customer profiles with validation dates.
Review Periodically
VAT numbers can become invalid. Review tax-exempt customers periodically to ensure continued compliance.
Consult Professionals
Tax laws are complex and change frequently. Work with an accountant familiar with Dutch and EU VAT regulations.
Troubleshooting
Tax not being calculated
Tax not being calculated
Check these settings:
- Is your business marked as VAT Registered in Settings?
- Does the product have a tax rate set?
- Is the customer accidentally marked as Tax Exempt?
Wrong tax rate appearing
Wrong tax rate appearing
Possible causes:
- Product has a different tax rate than your default
- Customer has specific tax settings
- Country-based tax rules are being applied
Tax Exempt customer still seeing tax
Tax Exempt customer still seeing tax
Check:
- Is the Tax Exempt toggle actually enabled on the customer profile?
- Was the invoice/order created before the exemption was set?
- Clear any cached cart data and try again
Invoice shows wrong tax amount
Invoice shows wrong tax amount
Verify:
- Check if Tax Included is set correctly on the product
- Ensure the tax rate matches what you expect
- For existing invoices, you may need to edit and recalculate
Related Documentation
Tax Exemptions
Detailed guide on managing customer tax exemptions
Invoice Tax Configuration
How tax is configured and displayed on invoices
Setup Fees
Configure one-time setup fees with custom names
Business Details
Configure your business information including VAT number
Tax regulations vary by country and situation. This documentation provides general guidance on PayRequest’s tax features. Always consult with a qualified tax professional for advice specific to your business.