Lago now features an automatic European tax detection integration for your customers.
Activate Lago’s automatic EU tax detection in just a few steps:
When you connect the Lago EU Tax Management integration, it automatically generates a list of standard European tax rates.
These rates, labeled as automated
in Lago, are synchronized with the latest standard tax rates for European countries,
ensuring your tax calculations are always up-to-date and compliant.
Each tax rate begins with the lago_
prefix, ensuring a uniform and easily identifiable format across your tax rate list.
This systematic approach simplifies the management and recognition of these automated tax entries within your system.
Automated tax rates
Automated tax rates
Lago’s initial step in the automated tax application involves verifying if a customer has a tax_identification_number
.
This check occurs whenever a customer’s profile is created or updated, ensuring that the most current tax-related information
is used in subsequent processes.
When a tax_identification_number
is identified on a customer profile, Lago conducts a real-time verification
using the EU’s VAT Information Exchange System (VIES) to
confirm the existence of the company.
In case the VIES check matches a valid company:
If the VIES check does not confirm an active company or if no tax_identification_number
is provided,
Lago then assesses the country
associated with your customer. Based on this:
country
is unspecified, Lago defaults to applying your organization’s country tax rate; orcountry
is within the European Union, Lago applies the tax rate corresponding your customer’s EU country; orcountry
is outside the European Union, Lago applies a tax exempt rate at 0%.Lago performs VIES verifications under these circumstances:
Lago ensures transparency and compliance by logging each VIES check. This occurs whenever you create or update a customer. For each check, Lago dispatches a webhook message. This allows you to record these validations for compliance purposes. You can access and review any of these automated checks as needed.