Why Include VAT?

Including VAT in your displayed prices is mandatory under EU law for B2C sales. Compliance with this requirement is not only a legal obligation, but also a proven driver of higher conversions in the EU, EEA, and UK markets by aligning with consumer sentiment and expectations for transparent pricing.

Key Benefits

• Required by EU law for all B2C transactions.
• Builds trust by avoiding hidden fees.
• Reduces cart abandonment caused by “sticker shock”.
• Meets customer expectations in German and European markets, where shoppers expect prices to include VAT.
• Improves conversion by showing the final price upfront.

Not recommended: Price + VAT (Net Price Displayed, VAT Added at Checkout)

When you display net prices, VAT is added only at checkout. This can cause consumer mistrust in an EU/ EEA/ UK market. Consumers are used to seeing prices inclusive of VAT when the product is advertised. 

Example

For a customer in Germany (19% VAT):

• A product is listed at €47.00 (net).
• At checkout, a customer from Germany is charged +19% VAT, bringing the total to €58.12 (gross).
• In this setup, the buyer first sees €47.00 on the sales page and then a higher price at checkout, which can lead to confusion or hesitation.

Not recommended: This approach can feel less transparent to end customers (B2C) and may negatively impact conversions.

Tip

For B2C offers, consider showing gross prices upfront to make costs clear and build trust.

Recommended: Gross Price Displayed (VAT Included)

Always display the gross price upfront inclusive of VAT.

This ensures full transparency and compliance with regional tax display rules.

Why This Matters

Displaying the gross price improves customer trust and conversions, as buyers immediately see what they will actually pay.

The vendor’s net revenue remains fixed at €47.00, while the VAT portion is automatically handled in the background.

Example

A customer in Germany (19% VAT):

• Displayed price: €58.12 (gross, incl. 19% VAT)
• At checkout, Digistore24 automatically deducts the correct VAT share depending on the buyer’s country.
• Price consistency: your sales page must show the same gross price that appears at checkout to ensure legal compliance and prevent customer confusion.

Current VAT rates (subject to change by law) if selling to multiple countries using the same funnel

VAT rates vary by product category AND country. VAT rates are set by the government of the respective country. Example of the varying rates per member state shown below:

• Germany: 19% (downloads)
• Austria: 20% (downloads)
• Switzerland: 8.1% (downloads)

Margin Adjustment

VAT rates vary by country - showing only the minimum gross price can shrink your margin in higher-VAT markets (like Austria).

Recommendation

Increase displayed gross prices by about 19% on average to maintain a consistent margin across all EU markets.

Results Summary

• Customers always see the final payable amount → higher trust and fewer cart drop-offs.
• Vendors maintain consistent margins across countries with different VAT rates.

Setup in Digistore24

To enable VAT-inclusive pricing:

1. In the vendor view, go to Product setup > Product configuration.
2. Click on the pencil icon for a product.
3. Switch to the Payment plans tab.
4. In the All prices are ... field, select the option gross prices (VAT is included).
5. In the Show VAT on order form field, you can select whether the tax rate (e.g., 19%) should be displayed on the order form.
6. Click Save.
7. Repeat this process for your other products.

Important Note

The information on this page is provided for general guidance only and may not reflect the most recent VAT rules or interpretations.
Because VAT obligations can vary by country and product type, you should consult your local tax authority or a certified tax professional before making decisions or issuing invoices.

While every effort is made to keep this information current and accurate, Digistore24 cannot accept responsibility for any loss or action taken based on this content.

Need help?

Please contact our support team at helpdesk@digistore24.com