How to Setup Tax Exemption in Magento 1.9.x

Many may be wondering how to setup tax exemption in Magento eCommerce stores for their customers. We will discuss a simple step-by-step process to setup tax exemption for your customers in your eCommerce store through Magento 1.9.x.

Setup Tax Exemption in Magento eCommerce

Step 1

Create a new “Customer Tax Class”.

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Step 2

Click “Add New”.

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Step 3

Create a new Customer Group.

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Step 4

We will now see our new “Tax Exempt” Group.

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Step 5

Next we can take a look at the “Tax Rules” that are setup:

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Step 6

We will notice that the Tax Rule only applies to Customer Tax Class “Retail Customer”.

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Step 7

Now we can assign customers to our new “Tax Exempt” group.

Run a test transaction for this customer to ensure that they are NOT charged tax when shipping to a state that you would normally be charging tax for.

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If you have any questions or concerns on how to setup tax exemption in Magento, contact us at Centennial Arts with the link below!