The Shopify EU marketplace uses VAT that is inclusive in the item and shipping prices. In NetSuite, taxes are exclusive of the item price and are added separately.
In the case of order import, when fetching order details from Shopify, it sends VAT inclusive prices for items and shipping prices. To handle this scenario from the integration app, enable the Settings > Order > Tax > Deduct GST/VAT from order total field
Deduct GST/VAT from order total on order import
Example of functionality when these settings are used against when these settings are not used for importing orders from Shopify. Let’s assume a Shopify order with the following details:
- Item price: $100
- Shipping Price: $20
- Promotional Discount: $10
With GST/VAT rate as 20%:
- Item Tax becomes: $20
- Shipping Tax becomes: $4
In this case, when importing an order in NetSuite, Shopify sends the order information as:
- Total Item cost: $120
- Total Shipping cost: $24
In the Settings > Order section > Tax tab, if the Deduct GST/VAT from order total box is checked, the order is imported as follows:
- Item cost: $83.33
- Shipping Cost: $16.67
- Tax Total: $20
- ETAIL TAX TOTAL VARIANCE: $0
Manage taxes with integration app settings to avoid variance
During order sync from Shopify to NetSuite, if there is a difference between the tax values calculated by NetSuite and the values sent from Shopify, the difference is stored in the ETAIL TAX TOTAL VARIANCE custom field on the sales order. You can manage tax within the Integration App in a way to avoid any tax variance which is recorded within NetSuite’s sales order record. To accurately calculate applicable VAT taxes in NetSuite and Shopify, use the following settings:
- Settings > Product > Add GST/VAT to item price: Check this check box to add GST/VAT to the item price before it is added to Shopify. Then another field should appear for the GST/VAT rate. Specify the GST/VAT rate in percentage that should be added to the item price when items are synced from NetSuite to Shopify. For example, if the VAT rate is 20%, specify the value as 20.
- Settings > Refund > Add GST/VAT to refund total: Check this check box to add the GST/VAT amount to the total amount being refunded.