VAT Exemptions

The module enables automatic VAT exemption for business customers within the EU (Reverse Charge) and for exports to countries outside the EU.

Go to module settings: WPify → WPify Woo > VAT ID in Checkout

How it works technically

The module sets the WooCommerce standard meta is_vat_exempt on the order and stores the exemption reason in _wpify_vat_exempt_reason. The module itself does not display any notes on invoices - displaying text like “Reverse Charge” must be handled by your invoicing plugin based on this meta data. More information can be found in the For Developers section.

EU Reverse Charge

The EU Reverse Charge feature enables automatic zero VAT application for customers from other EU member states who have a valid Tax ID.

Activation

Enable the “Enable EU Reverse Charge” option.

How It Works

1. Customer from an EU country (outside your country) enters Tax ID
2. Tax ID is verified via VIES (if validation is enabled)
3. If Tax ID is valid, WooCommerce automatically applies zero VAT
4. Meta data about exemption is saved to the order

Conditions for Application

Condition	Requirement
Destination country	EU member state, different from your country
Tax ID	Must be filled and valid in VIES
Customer type	Business customer (B2B)

Note

Reverse Charge does not apply if:

• Destination country is the same as your shop’s country
• Tax ID fails VIES validation (and validation is required)
• Customer hasn’t filled in Tax ID

Destination Country Determination

The destination country for VAT calculation is determined by WooCommerce settings:

• “Calculate taxes based on billing address” → billing country is used (typical for services)
• Other settings → shipping country is used (typical for goods)

This setting can be found in WooCommerce > Settings > Taxes > Calculate taxes based on.

Third Country Export

The Third Country Export feature enables automatic zero VAT application for customers from countries outside the European Union.

Activation

Enable the “Enable third country export” option.

How It Works

1. Customer selects a country outside the EU (e.g., USA, UK, Switzerland)
2. WooCommerce automatically applies zero VAT
3. Meta data about exemption is saved to the order

Conditions for Application

Condition	Requirement
Destination country	Country outside the European Union
Tax ID	Not required

Caution

When exporting to third countries, the customer may be required to pay customs duties and VAT when importing to their country. We recommend informing customers about this fact.

Deprecated: Zero VAT in Countries

Deprecated setting

The “Zero VAT in” setting (country selection) is deprecated and will be removed in future versions. Use the new EU Reverse Charge and Third Country Export features instead.

If you’re still using the old setting:

1. Countries for reverse charge are selected in the “Zero VAT in” field
2. Customer from selected country must have valid Tax ID (verified via VIES)
3. After validation, zero VAT is automatically applied

Migration to New Settings

1. Disable old setting (remove all countries from selection)
2. Enable “Enable EU Reverse Charge” for EU customers
3. Enable “Enable third country export” for customers outside EU

Order Meta Data

After order creation, the following meta data is saved:

Meta key	Values	Description
is_vat_exempt	yes / no	WooCommerce standard - whether order is VAT exempt
_wpify_vat_exempt_reason	see below	Exemption reason

_wpify_vat_exempt_reason Values

Value	Meaning
reverse_charge	EU Reverse Charge - B2B sales within EU
export	Export to third countries outside EU
legacy	Exempted via deprecated setting
domestic	Domestic sale (no exemption)
standard	Standard sale (no exemption)

Admin Display

In order detail, an information box is displayed with:

• VAT exemption status (Yes/No)
• Exemption reason

Orders with VAT exemption also have CSS class vat-exempt for easy identification.

Saving Changes

After making all changes, save settings using the button at the bottom of the page.