Fix: Auto-apply VAT ID to recurring subscription charges #2270

yashranaway · 2025-12-10T06:00:12Z

Issue: #721

Description

Problem

Customers with recurring subscriptions had to manually request VAT refunds for each charge by entering their VAT ID through the invoice page. If they added a VAT ID after the initial purchase, future recurring charges would still have VAT applied.

The existing get_vat_id_from_original_purchase method only checked the original purchase's VAT info and its refunds, not subsequent recurring charges. If a customer added a VAT ID after the initial purchase, it wouldn't propagate to future charges.

Solution

When a valid VAT ID is stored (either at checkout or via VAT refund), all future recurring charges automatically skip VAT.

Store business_vat_id on Subscription model
Capture VAT ID at two points: checkout and VAT refund
Priority order for VAT ID lookup: subscription's stored ID → original purchase tax info → original purchase refunds → any subscription purchase refunds
Backfill service for existing subscriptions

Note

The ~6,600 added lines are primarily VCR cassettes and test coverage.
Core implementation changes are minimal and tightly scoped.

Before/After

N/A - No UI changes, this is backend logic only.

Test Results

VAT ID from subscription's stored business_vat_id propagates to recurring charges
VAT ID from recurring charge's VAT refund propagates to subsequent charges
update_business_vat_id! method works correctly (set when blank, ignore when already set)
VAT ID lookup from original purchase refunds
VAT ID lookup from any subscription purchase refunds
Backfill service correctly populates existing subscriptions
Backward compatibility when no VAT ID exists

Checklist

I have read the contributing guidelines
I have watched Gumroad PR review livestreams
I have performed a self-review and left review comments on my PR
I have added/updated tests for my changes

AI Disclosure

I used Claude Opus via Claude Code for specs and tests generation.
All code was manually reviewed and verified by me.

yashranaway · 2025-12-10T06:01:05Z

app/models/subscription.rb

+  def update_business_vat_id!(vat_id)
+    update!(business_vat_id: vat_id) if vat_id.present? && business_vat_id.blank?
+  end
+


Stores VAT ID on subscription only if not already set. This prevents overwriting if customer provides a different VAT ID later.

yashranaway · 2025-12-10T06:02:52Z

app/models/subscription.rb

    def get_vat_id_from_original_purchase(purchase)
-      if original_purchase.purchase_sales_tax_info&.business_vat_id
-        purchase.business_vat_id = original_purchase.purchase_sales_tax_info.business_vat_id
-      elsif original_purchase.refunds.where("gumroad_tax_cents > 0").where("amount_cents = 0").exists?
-        purchase.business_vat_id = original_purchase.refunds.where("gumroad_tax_cents > 0").where("amount_cents = 0").first.business_vat_id
-      end
+      vat_id = business_vat_id.presence ||
+               original_purchase.purchase_sales_tax_info&.business_vat_id.presence ||
+               vat_id_from_original_purchase_refund ||
+               vat_id_from_any_subscription_purchase_refund
+
+      purchase.business_vat_id = vat_id if vat_id.present?
+    end


Priority order for VAT ID lookup:

Subscription's stored VAT ID (new)

Original purchase's sales tax info

Original purchase's VAT refunds

Any subscription purchase's VAT refunds (new - catches VAT ID added on recurring charges)

yashranaway · 2025-12-10T06:04:02Z

app/models/subscription.rb

+    def vat_id_from_original_purchase_refund
+      original_purchase.refunds
+                       .where("gumroad_tax_cents > 0")
+                       .where("amount_cents = 0")
+                       .order(created_at: :desc)
+                       .find { |refund| refund.business_vat_id.present? }
+                       &.business_vat_id
+    end


Finds VAT ID from VAT-only refunds on ANY subscription purchase, not just the original. Uses Ruby filtering because business_vat_id is stored in json_data column.

app/modules/purchase/refundable.rb

yashranaway · 2025-12-10T06:08:08Z

app/services/onetime/backfill_subscription_vat_ids.rb

One-time service to populate business_vat_id for existing subscriptions that have valid VAT IDs from purchases or refunds. Run after deployment: Onetime::BackfillSubscriptionVatIds.process

yashranaway · 2025-12-10T06:13:36Z

app/models/purchase.rb

      self.purchase_sales_tax_info = purchase_sales_tax_info
      self.purchase_sales_tax_info.save!
+
+      subscription&.update_business_vat_id!(purchase_sales_tax_info.business_vat_id) if purchase_sales_tax_info.business_vat_id.present?


If VAT ID is validated during checkout, store it on subscription for future recurring charges.

yashranaway · 2025-12-11T08:26:49Z

@ershad Can you please review this, thanks!

ershad

@yashranaway _a added a few comments, please take a look. Also discussed in the live stream (December 16).

db/schema.rb

ershad · 2025-12-16T17:10:04Z

app/models/subscription.rb

+  def update_business_vat_id!(vat_id)
+    update!(business_vat_id: vat_id) if vat_id.present? && business_vat_id.blank?
+  end


@michellelarney should we allow the buyer to use different VAT IDs in the course of a subscription? Or is it like, once they set a certain VAT in a subscription, we shouldn't allow to change that?

Generally I don't think people would need to change it and would usually be using the same VAT ID for all charges. I would say it should just stay the same.

app/models/subscription.rb

app/services/onetime/backfill_subscription_vat_ids.rb

app/models/subscription.rb

ershad · 2025-12-16T17:21:18Z

app/models/subscription.rb

+      vat_id = business_vat_id.presence ||
+               original_purchase.purchase_sales_tax_info&.business_vat_id.presence ||
+               vat_id_from_original_purchase_refund ||
+               vat_id_from_any_subscription_purchase_refund


Reviewer note: Measure performance impact before merging.

app/services/onetime/backfill_subscription_vat_ids.rb

yashranaway · 2025-12-16T20:49:00Z

Update: Addressed all review feedback:

Renamed get_vat_id_from_original_purchase → set_vat_id_for_purchase
Made vat_id_from_any_subscription_purchase_refund public (removed .send)
Added error handling in backfill service so failures don't break the script
Added inline comment explaining json_data filtering
Reverted unrelated schema.rb changes (audience_export tables)
Business decision on VAT ID change policy (@michellelarney)

Pending:

Performance measurement before merge for reviewers

yashranaway · 2025-12-23T11:37:35Z

Hey @michellelarney just a reminder about this comment when you get a chance. thank you
#2270 (comment)

cc: @ershad

yashranaway · 2026-01-14T18:37:28Z

@ershad Friendly ping on this.

spec/models/subscription_vat_id_spec.rb

ershad

@yashranaway reviewed during PR review session, please take a look at the comments.

app/models/subscription.rb

app/modules/purchase/refundable.rb

db/migrate/20251210053000_add_business_vat_id_to_subscriptions.rb

app/models/purchase.rb

spec/models/subscription_vat_id_spec.rb

yashranaway · 2026-01-22T17:30:30Z

Hey @ershad _a , addressed all comments and replied. Could you please take another look? 🙏

yashranaway · 2026-01-26T13:46:15Z

@ershad friendly ping on this, since core changes were accepted in review sessions only tests had fixes remaining which is done could you please take a look?

yashranaway · 2026-01-30T06:12:34Z

@nyomanjyotisa I noticed you were recently assigned to this issue. This PR has already been through review, all feedback has been addressed, and tests are passing. Could you please take a look when you have time?

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yashranaway commented Dec 10, 2025

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yashranaway mentioned this pull request Jan 17, 2026

Fix: sendgrid resend fallback #2769

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pegasus1134 mentioned this pull request Jan 19, 2026

Fix: Auto-apply VAT ID to recurring subscription charges (#721) #2967

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Fix: Auto-apply VAT ID to recurring subscription charges #2270

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Fix: Auto-apply VAT ID to recurring subscription charges #2270

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