--- title: 'Auto Tax Mode' url: 'https://manuals.remository.com/payage/gateway-stripe-checkout/auto-tax-mode' markdown: 'https://manuals.remository.com/payage/gateway-stripe-checkout/auto-tax-mode.md' date: '2026-11-14' description: "In this mode, you can have Stripe automatically calculate the sales tax (VAT, TVA, etc) depending on your customer's location. Stripe auto tax is a more complete implementation than PayPal auto tax (although there is a 0.5% charge for using it): Stripe automatically maintains the tax rates for eac…" taxonomy: category: - docs --- [](#) [ edit this page](https://github.com/getgrav/grav-skeleton-rtfm-site/blob/develop/pages/22.gateway-stripe-checkout/04.auto-tax-mode/docs.md) # Auto Tax Mode In this mode, you can have Stripe automatically calculate the sales tax (VAT, TVA, etc) depending on your customer's location. Stripe auto tax is a more complete implementation than PayPal auto tax (although there is a 0.5% charge for using it): - Stripe automatically maintains the tax rates for each country and product category. - Stripe handles the reverse charge method for business-to-business sales, capturing and validating the buyer's business name and tax ID. With Stripe auto-tax it's possible to fully support EU VAT and many other tax systems worldwide. Stripe has an introduction to EU VAT, here: https://stripe.com/gb/guides/introduction-to-eu-vat-and-vat-oss In auto tax mode, the tax amount passed to Payage by the calling application is ignored. The only tax amount used is the one applied by Stripe. It is passed back to the application so that the application can store it and use it for its reports. ![](https://manuals.remository.com/payage/user/pages/22.gateway-stripe-checkout/04.auto-tax-mode/p-52_1.jpg) In auto tax mode, the tax amount is calculated during checkout. Stripe prompts the buyer to enter their billing address, and uses it to calculate the correct tax. The buyer can also tick the "I'm purchasing as a business" box and enter their tax information, which Stripe validates. For EU VAT, Stripe does not then charge VAT. The Tax ID is subsequently captured by Payage and populates the %TAX\_ID% invoice variable. After payment, Payage captures the tax amount, business name, address, and tax ID, which can be included on the Payage invoice. The tax information is also available to the calling application. If you use Auto Tax Mode, we recommend that you do not use a Payage gateway fee, since the amounts become difficult to understand. If you use Stripe in auto tax mode you cannot offer a choice of payment gateways to your customers because the tax treatment would be different depending on the customer's choice of gateway. ## Inclusive or Exclusive Stripe has two auto tax modes, inclusive and exclusive. With inclusive mode, the amount requested by the application is the final amount that the customer pays, inclusive of tax. If you price your item at €5 and the tax is 20%, the customer pays €5, the tax is €0.83, and the net price is €4.17. With exclusive mode, the amount requested by the application is the amount excluding tax. If you price your item at €5 and the tax is 20%, the customer pays €6, the tax is €1, and the net price is €5. In both cases the actual gross and tax amounts are passed back to the application and should be handled correctly in reports. ## Setting Up Auto Tax Mode To get started, go to https://dashboard.stripe.com/test/settings/tax You will need to set a Preset product tax code by choosing a product category that best fits your products. You can override the tax code by entering a tax code in the Payage account "Tax code" setting, so if necessary you can setup different accounts for your different product types. You will also need to set the "Include tax in prices" option. It doesn't matter what you set it to because it will always be overridden by the Payage account "Auto tax mode" setting. You can ignore the "Options to integrate tax" items. Finally you must setup one or more tax registrations at https://dashboard.stripe.com/test/tax/registrations. Click Add Registration, select a country, and then select an option. Stripe will then calculate tax for the countries covered by that registration. [ ](https://manuals.remository.com/payage/gateway-stripe-checkout/payment-methods) [](https://manuals.remository.com/payage/gateway-stripe-checkout/test-accounts) --- ## Navigation - Parent: [Gateway: Stripe Checkout](https://manuals.remository.com/payage/gateway-stripe-checkout.md) - Previous: [Payment Methods](https://manuals.remository.com/payage/gateway-stripe-checkout/payment-methods.md) - Next: [Test Accounts](https://manuals.remository.com/payage/gateway-stripe-checkout/test-accounts.md)