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How to manage tax zones and rates in Magento

  1. Navigate to Sales - Tax - Manage Tax Zones and Rates
  2. Click Add New Tax Rate button
  3. Fill out: Tax Identifier, Country, State, Zip/Post is Range, Zip/Post Cide, Rate Percent
  4. Fill out Tax Titles
  5. Click Save Rate orange button

With our previous tutorial we kicked off series of tax related tutorials and the time has come to show you how to set up tax zones and rates in Magento.

Hopefully, your business will successfully grow and that means that your customer groups will expand and ramify, forcing you to adapt the way you are doing business online.

As we mentioned, tax rules are comprised of product class, customer tax class and tax zone and rate.

Previously, we created customer tax class and assigned it to a customer group. Also, we created new product class and assigned it to our product.

Now the only thing left to do is to show you how to manage zone related taxes and make it possible for Magento to calculate correct tax rate for customers according to the products they have chosen and placed into their cart, tax class on those products, and place where the goods will be delivered which will be calculated based on customer’s shipping address.

In the beginning, navigate to Sales and choose Manage Tax Zones and Rates from the dropdown menu.

Managing tax zones and rates in Magento

A new screen will appear and you will see an overview of all tax rates currently in your store.

Click Add New Tax Rate orange button.

How to manage tax zones and rates

The entire procedure is rather straightforward and easy, all you have to do is fill out several tabs.

Tax identifier – this is a unique field name for this tax. As you can see in the screenshot below, this tax identifier will be used in case you miss out to enter Tax Titles.

Also, note that you should avoid using spaces when naming this tax.

When it comes to Country, simply open dropdown menu and choose the country that this tax rate will apply to.

You will notice that we have placed country code inside the brackets to add more detail to our tax rate.

When filling out field State, we suggest you use (*) asterisk, a wildcard character that will involve all states.

Now, simply enter your rate percent and head over to setting up Tax Titles.

Adding new tax rate in MagentoAfter you have successfully entered all details and defined your tax rate, as always, click orange Save Rate orange button in the upper right corner and save your new rate.

Continue adding state by state having in mind all states that you are shipping to following the same pattern.

Once you save your rate, under Manage Tax Rates, you will be able to see an overview of all tax rates you have added.

It will appear like this:

Setting up tax rates in Magento

And finally, we move onto setting up Tax Rules, the tutorial that will sum up all previous steps and make your taxes appear on your online store.

Make sure you don’t miss out!