When setting up VAT rates, you can choose to add or subtract rates, which makes a significant difference. The difference is how the VAT rates will be reflected in the price of the services.
However, if you are not a VAT payer, you do not need to worry about setting the VAT rates.
Added VAT rate
If you select the added VAT rate, the price of the service automatically increases by the set percentage.
In practice, your service costs €100 without the VAT rate. You set the added VAT rate at 20%. The price of the service therefore automatically adjusts and instead of the original €100, the service now costs €120 (€100 + 20%).
On your Booking Website, customers see that the service costs €100, the VAT rate €20 and they pay €120 in total.
Deducted VAT rate
If you choose the VAT rate deducted, the set prices remain the same. This option is great if you want to show customers the VAT rate, but it doesn’t affect the total they pay.
For example, you have set the price of the service to €100. You choose a VAT rate deduction of 20% for this service. The price of the service remains the same, i.e. €100, with the VAT rate included.
On your Booking Website, customers see the total price of the service - €100. During checkout, they see the price broken down to service price - €83.33 and the VAT rate of €16.67.