Set Up Your Shopify EU VAT Settings Before Using CommBilling

Do This First: Set Up Your Shopify EU VAT Settings Before Using CommBilling

Before you start using CommBilling to generate invoices, apply VAT, and manage your billing workflow, it’s essential to make sure your Shopify store is correctly configured for VAT in the European Union

CommBilling uses the tax settings defined in your Shopify admin to generate accurate and compliant sales documents. If your VAT setup in Shopify is incomplete or incorrect, the data passed to CommBilling will reflect that resulting in the wrong VAT rates being applied to your invoices.

This article outlines the key steps you must complete in Shopify before you begin using CommBilling.

Why It Matters

CommBilling doesn’t calculate tax rates on its own. It works with the tax data already calculated by Shopify at checkout. If your Shopify settings are not aligned with your VAT obligations (for example, if you’re selling across multiple EU countries), the invoice generated will not reflect the correct VAT rate or country-specific compliance requirements.

Pre-CommBilling Checklist: Set Up EU VAT in Shopify

Make sure your Shopify VAT settings are configured correctly before using CommBilling:

Step 1: In your Shopify admin, click on Settings

Step 2: Click on Taxes and Duties

Step 3: Under the Regional Settings section, click on European Union

Step 4: In the Collect VAT cross-border section, click Collect VAT in European

Step 5: In the pop-up, choose how you want to collect VAT:

Select Use One Stop Shop (OSS) if you're registered under the OSS scheme. This is recommended for most merchants selling across the EU. Shopify will apply the correct VAT rate based on each customer's shipping address.

Select Use your home country VAT registration only only if you're not registered for OSS and only sell locally or under distance selling thresholds.

Step 6: Click Collect VAT

Once this is complete, Shopify will automatically apply the correct VAT rates per country and CommBilling will use that information to generate invoices correctly.

What Happens If You Skip This Step?

If VAT is not properly configured in Shopify:

• Your customers may be charged the wrong tax rate
• CommBilling invoices may reflect incorrect VAT amounts
• You could face compliance issues for cross-border sales
• You may need to manually correct or regenerate invoices

Before onboarding CommBilling into your workflow, take a few minutes to ensure your Shopify tax settings are correctly set up for EU VAT. This small but essential step ensures your invoices are compliant, your taxes are correct, and your customers are charged accurately from day one.

Once your Shopify setup is ready, CommBilling can take over, automating your invoicing, applying VAT correctly, and helping you run a more professional and efficient e-commerce operation.