How To Set Up Magento 2 Tax Exempt For Customers

In this article, we will show you how to set up Magento 2 tax exempt for customers. Let’s go!

Why Should You Set Up Tax Exempt?

Tax-exempt refers to transactions or income that are free from tax.

When you are selling your products, there might be some customer groups that need to be charged tax-free. For example:

• A tax-exempt organization making purchases for their events
• A retail business would not have to pay sales tax when buying wholesale items that will be resold to an end-user

Thus, it’s necessary to set up a tax exemption in your store to sell to those special customer groups.

Set Up Magento 2 Tax Exempt For Customers: A Full Guide

To set up Magento tax exempt for customers, you need to follow 3 steps.

Step 1: Create the tax exempt rule

Navigate to Stores > Taxes > Tax Rules.

Click on “Add New Tax Rule”

Set the name as Tax Exempt.

Next, create a new Tax Rate for Tax Exempt by selecting Add New Tax Rate.

Save the Rate.

Select Tax Exempt under Tax Rate:

Next, go to Additional Settings.

You need to create a new Customer Tax Class. Click on Add New Tax Class, name it as Tax Exempt, and click the checkbox, then select Tax Exempt under Customer Tax Class.

Step 2: Assign the new customer tax class to a specific customer group

After creating the rule, assign this Customer Tax Group to the customer group you want.

For example, we will apply it to the Wholesale customer group.

Navigation to Customers > Customer Groups.

Select the Wholesale customer group and change the Tax Class to Tax Exempt:

Step 3: Assign customers to the customer group

Navigate to Customers > All Customers.

Here, when creating a new customer account or editing an existing customer account, you can choose the “Wholesale” customer group to apply tax exempt for them.

Best Solution To Set Up Magento 2 Tax Rules Per Store View

As you know, different countries or states have different tax policies. Thus, not only is it required to set up a different tax rate for each customer group but also for each country or state.

However, the default Magento 2 only allows adding the same tax rate to products on your entire website. And it’s a huge drawback if you are selling for many different places that have different tax policies.

So hereby, we want to introduce to you the best tool you solving that problem:

Magento 2 Tax per Store View by BSS

This Magento addon allows you to select Store View as the scope of tax class attributes. Using this module, you can easily charge different taxes for the same product in different stores or store views. It also enables assigning various tax classes for tax rules along with varying rates of tax per store view.

>>> To learn more about Magento 2 setup and configuring its features, explore this post: [2024 Update] Magento 2 Tutorial for Developers & Merchants

Conclusion

In this article, we have shown you how to set up Magento 2 tax exempt for your customers. We hope this blog is helpful and good luck to you!

BSS Commerce is one of the leading Magento extension providers and web development services in the world. With experienced and certified Magento developers, we commit to bringing high-quality products and services to optimize your business effectively. Furthermore, we offer FREE Installation – FREE 1-year Support and FREE Lifetime Update for every Magento extension.

CONTACT NOW to let us know your problems. We are willing to support you every time.