Adding Tax on your Fees and how they work

Adding Tax

As a marketplace owner, you can choose to add tax to the fees that you get commissions from vendors. In the admin, go to Stores > Settings > Configuration > Omnyfy > Marketplace Commercials Management.

Here on the right side of the configuration, you will be able to see your Default Vendor Fees section.

Tax name: This will appear on the invoices that the vendors receive

Tax rate (%): This will set the percentage for the vendor AND category fee. This is additive, meaning it will not be included category or vendor fee % value (see calculations below).

NOTE: You can also add the tax individually for each vendor here: Set Marketplace Fees and Charges Per Vendor

NOTE: If no tax is added in the default configuration, or the active individual fees for the vendor, then no tax will be calculated for the payouts.

How is tax calculated on fees?

If you add tax fees, it will be an additive % from the Seller Fee and Category Fee. The Seller and Category fees are based on the Net value (pre-tax). Once the fees are calculated, the tax for the fees are calculated, then added to the total fees.

In the above example, the product was sold with tax, so the product price before tax is $90.91. The Vendor Fee is 10% of the net price, so it is $9.09. Then another 10% tax is added, which makes it $0.91. This means the vendor fee of $9.09 + fees of $0.91, will total $10.00. This also applies to category fees.

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