How to Take Care of Tax Calculation in LearnWorlds with Quaderno

LearnWorlds supports a built-in integration with Quaderno, which can make the whole taxation process easier. Quaderno is an automated tax management solution that simplifies the process of calculating and applying taxes for your digital products. 

By utilizing Quaderno with LearnWorlds, you can ensure accurate tax compliance, streamline your sales process, and focus more on delivering quality content to your learners. As an invoice application, it makes the taxation process and EU VAT compliance rules easier to handle and manage.

In this article, we'll explore how to handle tax calculations within LearnWorlds by integrating Quaderno.

Quaderno seamlessly integrates with your LearnWorlds account to automatically calculate the correct tax rates for each sale based on the customer's location. This integration automates tax management for sales processed through Stripe (including payment methods like Klarna, Afterpay, Google Pay, Apple Pay, etc.) and PayPal within your LearnWorlds school.

Billing Details as a prerequisite

When you enable Quaderno in your school, the Billing Details under the Financial Tab will be automatically activated, as they are essential for this integration. During the checkout process, Quaderno calculates the correct tax rates for each transaction. Additionally, if a valid Tax ID is provided for EU transactions and the company is registered in VIES, the transaction will be treated as a B2B sale, and taxes will not be applied. 

Quaderno Use Cases

• Automated Tax Calculations: Quaderno automatically calculates the correct tax rates based on the customer's location.
• Compliance Management: Stay compliant with international tax regulations effortlessly.
• Simplified Invoicing: Automatically generate and send tax-compliant invoices to your customers. You can also use the Quaderno-generated invoices in case you want to apply further customizations to the invoice’s appearance.
• Accurate Reporting: Get detailed tax reports to help with your accounting.
• Sales Process Optimization: Streamline your checkout process by incorporating real-time tax calculations.
• Automatic Tax ID Verification: Automatically verify the Tax IDs of your customers.
• Customer Location Evidence: Collect and store the customer location evidence required from every sale (and store it for up to 10 years).
• Multilingual and Multicurrency Invoices: Create and send invoices in multiple languages and currencies.
• Tax Return Optimization: Help ensure you don’t overpay on your tax returns.

Additionally, Quaderno offers a tax reporting feature. When it’s time to file your taxes, go to the Reports section, choose the desired report and date range, and you'll be able to see your sales and the amount of tax owed for each country.

Setting up Quaderno

The user billing details and taxation data will be synced with the information stored by your payment gateway for each transaction. You can choose whether the product price should include taxes or if taxes should be calculated on top of the product price at checkout. After completing a transaction, the generated invoice will also include all relevant tax information.

Activate Quaderno

In order to connect your LearnWorlds school with Quaderno, you need to:

1. Activate a Quaderno Subscription and create your account by following the steps mentioned here.

Note: Under the Preferences → Default tax class, you need to register your product as an “e-service”.

2. Select your tax jurisdictions in Quaderno. 

As soon as you proceed with the setup, Quaderno will automatically define and create the Tax Rates that apply to your product types and within these jurisdictions (no need to proceed with any extra action from your end).

Connect Quaderno with your LearnWorlds School

As soon as you complete the previous steps:

1. Navigate to your LearnWorlds school under Settings → Financial → Tax Management.

2. Activate the Quaderno integration.

3. Connect your Quaderno account. If you are not already logged in to Quaderno, you will be navigated to the Quaderno Login form and then redirected back to your school. A Quaderno account cannot be connected with more than one school.

4. In Tax Calculation, select whether the checkout will include the initial or final product price so that the VAT amount will be added to or subtracted from the product price (taxation or detaxation).

5. Enable LearnWorlds to fetch invoices generated from Quaderno and make them available in your school and also shared with your customers. If you enable this option, the invoices settings under Financial → Invoices Setup will become inactive. 

Notes: 

• If you like to keep the invoice numbering sequentially when enabling the Quaderno Invoices, follow the steps mentioned in this support article.

• As soon as the Quaderno integration is activated, the new billing information section under Financial → Billing Details will be automatically activated since the users' responses in the standard billing details need to be forwarded to Quaderno in order for the integration to fetch and apply the correct taxes for every purchase. For more information about the Billing details, click here. 
• Some standard billing details (Name, Address, Postal code, Country) are required for the integration to be functional and thus are not further editable when the integration is activated.
• For more information on Sales Taxes Guidance for online courses, you can check this link.
• Once a transaction is completed from your LearnWorlds school:

a. All transaction data will be sent to Quaderno as, by default, Quaderno will generate invoices and keep a full registry of your school's purchases. If you have enabled the previous 8th step (Fetch Quaderno Invoices), then the invoices will also be stored in your School under Reports → Sales and under Users → All Users → specific User Card.

b. The Quaderno contact data and customer records will also be synced.

User Interface

As soon as a user navigates to the checkout page of a product, the new billing details will automatically be activated, as Quaderno needs the user’s location to apply the correct taxes. When the user enters their billing details, the product price will automatically adjust to reflect any taxes with the corresponding transaction.

Once the billing details are completed or changed, the payment section will display an area dedicated to tax analysis along with the product price, according to the user location, as provided in the standard billing details. If Quaderno does not recognize the billing details provided by the customer, then no taxes will be applied to the purchase. 

Quaderno Checkout Links

In case you would like to use Zapier with Quaderno, you can check our article on Quaderno checkout links on LearnWorlds here. 

General Notes/Tips

• For existing Quaderno customers, migrating to the built-in integration is unnecessary, as both flows work independently.
• The percentage of the instructors’ and affiliates’ commission is calculated based on the total price of the product (including or excluding taxes, depending on the Quaderno setting that you have selected).
• Regarding payment plans, the name of the payment plan displays by default the original prices of the initial payment (if you have selected an advanced payment plan with an upfront payment) and the following recurring payments. If the Quaderno Taxes are exclusive, this will result in the following break-down of prices: 

• The standard billing details are forwarded to Quaderno for the calculation of the taxes to be applied in the corresponding transaction, and they are also included in the Quaderno-generated invoices. This does not apply to the custom billing detail fields, as they will not be included in the Quaderno (or the LearnWorlds) invoices.
• If Quaderno does not calculate taxes for a given country, the reason can be that you have not set the corresponding jurisdiction in Quaderno. In this case, no taxes are calculated/applied for the transactions from the corresponding countries, and you will have to monitor and pay the corresponding taxes manually.
• Quaderno monitors thresholds per country, and you can monitor your sales against the thresholds per country to know when you have to register in a country and file taxes for sales in this country.

• If you have integrated Stripe as your payment gateway, enabled Quaderno in your school settings, and you have set the Business Tax ID as required, then this will not be displayed in the form of a "checkbox" and the text "I am purchasing as a Business", but as a regular field in the payment page.