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1 November, 2022Include tax in order total
How Include tax in order total works
Introduction
The ‘Include Tax in Order Total’ feature in BON Loyalty helps ensure that tax is properly considered when calculating customer rewards for completed orders. This guide will explain how to enable this feature, how it impacts points calculation, and best practices to avoid tax duplication with Shopify settings.
Overview
How to include tax in the order total
In BON, go to Settings > Scroll down to find the Include tax option > Click Enable button > Click Save.
How ‘Include tax in order total’ works
This option affects how many points are given to customers when they ‘Complete an order’ to earn points with Increments of points reward type.
Example: If the ‘Complete an order’ point-earning action rewards 1 point for each dollar spent and the product price is $30.
Based on the above example:
- If ‘Include tax in order total’ is turned off, the customer will receive 30 points ($30 subtotal).
- If ‘Include tax in order total’ is turned on, the customer will receive 33 points ($30 subtotal + $3 tax).
Avoid duplicating tax in the points calculation
IMPORTANT NOTE: If the ‘Include sales tax in product price and shipping rate‘ option is enabled in Shopify, we strongly advise disabling the ‘Include tax in order total‘ feature in BON. This prevents the duplication of tax during points calculation.
For example, with a product price of $33 ($3 tax included), customers will earn 33 points. However, if the ‘Include tax in order total‘ feature is enabled in BON, the app will add the tax to the product price, resulting in customers earning 36 points ($33 product price + $3 tax).
In Shopify admin > Settings > Taxes and duties, there is an option: Include sales tax in product price and shipping rate.
When this option is activated, Shopify assumes the tax is already included in the listed price, and no additional tax will be added at checkout. If you have not included tax in the listing price, do not activate this option.
Example: If a product is listed at $1,100 with tax included, Shopify will not add an additional $71.96 tax at checkout. The subtotal remains $1,100.
