The feature to automatically calculate tax is only available when hosting paid webinars with a Stripe connection. It’s not available when you use Mollie.
Normally when you host paid webinars, you have to set a price that includes tax, meaning that you have to do the math and manually calculate the final price. With the option to have Stripe calculate the tax, you can opt to enter the webinar price without tax and have Stripe determine the tax automatically, or enter the webinar price with tax like before so that Stripe shows the subscriber how much of the price is tax.
Enabling automatic tax calculation
Configuring Stripe to use automatic tax calculation
Tip! You can move on to ‘Enabling automatic tax calculation in a webinar’ if you’ve completed the Stripe configuration before. The steps in Stripe only have to be completed once.
The first part of activating automatic tax calculation is configuring your Stripe account to calculate tax. This can be a bit confusing, so make sure to follow the steps closely.
Step 1: Confirm your origin address in Stripe
Your origin address is where your business is located. Stripe sets it to your business address by default, so all you have to do is confirm that this address is correct.
If the steps below are outdated, please let us know and check Stripe’s documentation here. This is step 1 in Stripe’s article.
Log in to your Stripe account on https://dashboard.stripe.com/
Under ‘Products’ on the left-hand sidebar, click ‘More’ and then click ‘Tax’
Click ‘Quick actions’ and then ‘Configure tax settings’
Click the pencil icon next to the country under ‘Business information’
Make sure your origin address is correct and click ‘Save’
Step 2: Confirm your tax category
Each product falls into a different category for taxes, with many different categories often having different tax percentages. Stripe uses this setting to determine which percentage to apply to your transactions.
If the steps below are outdated, please let us know and check Stripe’s documentation here. This is step 2 in Stripe’s article.
Log in to your Stripe account on https://dashboard.stripe.com/
Under ‘Products’ on the left-hand sidebar, click ‘More’ and then click ‘Tax’
Click ‘Quick actions’ and then ‘Configure tax settings’
Select your preset category with the dropdown menu under ‘Preset tax category’; what you should pick most likely depends on the content of your webinars. For example, you could choose ‘Training Services - Live Virtual’ for instructional webinars.
Your change will save automatically.
Step 3: Adding a tax registration
The final step we have to take in Stripe is adding a tax registration. Without one, taxes will not be calculated by Stripe.
If the steps below are outdated, please let us know and check Stripe’s documentation here. This is step 4 in Stripe’s article.
Log in to your Stripe account on https://dashboard.stripe.com/
Under ‘Products’ on the left-hand sidebar, click ‘More’ and then click ‘Tax’
Click ‘Add registration’
In the first screen, select the location you want to add a tax registration for
Select ‘I’ve already registered’. Keep in mind that you do need an actual registration. Alternatively, you can use ‘Register for me’ if you’re willing to pay for Stripe’s service. Click ‘Next’.
Select which registrations are applicable to you for this location; this step may be skipped depending on the chosen location. When done, click ‘Next’ again.
On the next page you might be asked some additional questions. Answer them and click ‘Next’ again.
Select whether you want to start collecting tax immediately or at a later date
Confirm that the tax rate at the bottom is correct and click ‘Start collecting’ (or ‘Schedule collecting’ if you scheduled a later date)
After following these steps, you’ll be able to find your active tax registrations in the ‘Registrations’ tab of your tax overview in Stripe.
That’s it! You’re done with the configuration of your Stripe account. The rest has to be configured in your WebinarGeek webinars, and is a much easier process.
Please note! Taxes are only calculated for locations you’ve added a valid registration for. For example, registrants from the USA won’t have their taxes calculated if you’ve only got a domestic registration for the Netherlands, because that only calculates tax for subscribers in the Netherlands.
Enabling automatic tax calculation in a webinar
These steps assume that you’ve already created a paid webinar. Still need to create one? Check out this article.
The steps in Stripe listed above must also have been completed once.
Did you take care of the configuration in Stripe and are you ready to apply automatic tax calculation to your paid webinar? Awesome! Follow these steps to activate it:
Navigate to your webinar and click ‘Edit webinar’
Go to ‘Registration’
Go to ‘Payments’
Under ‘Taxes’, enable the switch next to ‘Allow Stripe to handle taxes’
Use the dropdown menu labeled ‘Tax setting’ to select your preferred mode. ‘Tax included’ is selected by default.
That’s it! Automatic tax calculation is now active for your webinar.
Available tax settings
There are two available settings for Stripe’s automatic tax calculation during checkouts.
Tax included - Customers will pay the exact price you set
When you use the ‘Tax included’ mode, the price you enter as your webinar’s price will include the tax. This means that the subscriber pays what the price they see on the registration page. The added value of this mode is that both the subscriber and you can see how much of the price is tax.
So, for example, if your webinar is set to cost $5.00 and the tax (VAT) percentage is 21%, the subscriber would see this at checkout:
Tax excluded - Tax will be added to the price during checkout
When you use ‘Tax excluded’ mode, the price you enter as your webinar’s price will exclude the tax. This means that the subscriber will pay taxes on top of the price they see on the registration page. The added value of this mode is that you don’t have to calculate tax for your webinar’s price before configuring it, as it’s added automatically. When using this mode, payment confirmation emails will reflect the full amount paid.
So, for example, if your webinar is set to cost $5.00 and the tax (VAT) percentage is 21%, the subscriber would see this at checkout:
Fees for automatic tax calculation with Stripe
Unfortunately, automatic tax calculation isn’t a free service. Stripe charges €0,45 ($0.50) per transaction which uses automatic tax calculation. You can read more about the fees for Stripe VAT here.
Please note that WebinarGeek also charges a handling fee of 5% per transaction for hosting paid webinars. This 5% is calculated based on the price without tax. You can read more about WebinarGeek’s handling fee here.
If you host a paid webinar with automatic tax calculation on ‘Tax included’ mode, the 5% will be calculated over the entered price minus the tax (e.g. for a webinar that costs $10.00 with 21% tax, that would mean the 5% is calculated over $8.26).
If you host a paid webinar with automatic tax calculation on ‘Tax excluded’ mode, the 5% will be calculated over the entered price for the webinar.
Good to know
Discounts are applied before tax is calculated
When a subscriber uses a discount for your paid webinar, their discount is added before tax calculation. This means that, when your webinar costs $10.00 and a subscriber uses a discount code for $1.00, the tax will be calculated over the remaining $9.00.
Automatic tax calculation in the payment statistics
The payment statistics for your webinar reflect the full amount paid, though you can also see the base price in the detailed statistics for the subscriber.
Below is an example of someone that paid for a webinar configured with ‘Tax included’ mode. As you can see, ‘Taxes included in the price?’ is set to ‘Yes’ because we used the ‘Tax included’ setting and the ‘Webinar price’ is the same as the ‘Paid amount’.
Below is an example of someone that paid for a webinar configured with ‘Tax excluded’ mode. As you can see, ‘Taxes included in the price?’ is set to ‘No’ because we used the ‘Tax excluded’ setting and the ‘Webinar price’ is lower than the ‘Paid amount’ because the latter includes the tax.
When tax isn't calculated automatically by Stripe, ‘Taxes handled automatically?’ will be set to ‘No’.
This data is also included in any CSV exports of your payment statistics.
Automatic tax calculation in the transaction overview
Your WebinarGeek account’s transaction overview includes data on the use of automatic tax calculation, just like your webinar’s payment statistics. When viewing your transaction overview, you can click ‘Details’ next to any transaction to see whether a transaction had tax handled automatically, whether or not the tax was included in the price and how much was paid.
Below is an example of the payment details for a transaction made with ‘Tax included’ mode. As you can see, ‘Price includes taxes’ is set to ‘Yes’ because we used the ‘Tax included’ setting and the ‘Webinar price’ is the same as the ‘Amount paid’.
Below is an example of the payment details for a transaction made with ‘Tax excluded’ mode. As you can see, ‘Price includes taxes’ is set to ‘No’ because we used the ‘Tax excluded’ setting and the ‘Webinar price’ is lower than the ‘Amount paid’ because the latter includes the tax.
When tax isn't calculated automatically by Stripe, ‘Taxes handled automatically’ will be set to ‘No’.