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Zuora Staff

Steps to verify why tax was charged when it should not

Question: We have a customer who is registered with an address in Gibraltar (country code) but he is receving an invoice where he is being charged VAT. Our Z-Tax rules are setup to charge VAT only if you are in the UK country. Can you please advise why was this account charged tax using UK's 20% tax? 

 

Customer account contact: 

Screen Shot 2017-04-21 at 7.30.40 AM.png

 

Invoice taxed 20% under UK VAT: 

Screen Shot 2017-04-21 at 7.31.48 AM.png 

Z-Tax table is under UK VAT

Screen Shot 2017-04-21 at 7.22.23 AM.png



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1 REPLY 1
Zuora Staff

Re: Steps to verify why tax was charged when it should not

Troubleshooting Steps

 

1. Identifying which tax rate was applied

a)  The tax rates are available in the Tax Rates Import file. Please identify which taxes were applied.

b)  If there are multiple taxes and it is not possible to identify which tax was applied, it is possible to enter troubleshooting data in the Tax Rate Description, Location Code and/or Jurisdiction that is associated to those taxes.

c)  When you run billing again, you should be able to identify the specific tax used by reviewing these fields in the Invoice Details Extract file.

 

2. Incorrect Tax Rate is applied

a)  Identify which tax rate was applied.

b)  Review matching rules with the Sold To address

c)  If the fields in the tax rate identically match the corresponding address filed for the Sold To Contact then the address could have changed after the orignal invoice was generated.

 

In this use case i use an example that a Country of Gibraltar was charged UK tax. Go to the customer's invoice > Scroll down to History section > Click on Invoice PDF generate (first version). You will see that when the invoice was created it was under a different address(in UK). So the tax was calculated using UK VAT which is correct. This is probably the quickest way to verify the tax issue. 

 

I have also attached a Z-Tax instruction documetnation in this article. Please see attachement. 



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