I spent a while battling this and didn't find an obvious answer posted on either the Zapier or Zoho forums so thought I'd share my solution and hopefully save someone else the time. Of course someone might turn around and say there is a much simpler solution, and I will hate them forever, but this is what worked for me.

Problem: I want to use a Zap to automatically generate an invoice in Zoho Books whenever a new order is placed in eBay, and for this invoice to have the correct VAT applied to the sale amount. Even if you enable VAT for your eBay listings, the eBay API that the Zap calls does not appear to have a field for the price net of VAT, only the gross sale amount (or amount net eBay fees). When your invoice is generated in Zoho Books for an item which is set up for VAT, it calculates VAT on the gross sale which already includes VAT. This results in an incorrect VAT amount on the invoice.

 Solution: 

 1. Set up Items in Zoho Books: In order to apply VAT to incoming orders via the Zap you need to have the items set up in Zoho Books. I have around 100 eBay SKUs so I did this as an import upload (burger bar on Items page). There is a sample file on the upload page, which I then trimmed down to the fields I wanted (Item Name, Tax1 Name, Tax1 Percentage, Tax1 Type). This presumes you have VAT set up already in Zoho Books, there are guides elsewhere on how to do this. As a general note the Zap has a required field of rate (price) which will override the rate set in Zoho Books when the invoice is generated, so no need to fill that in here. Also, because the Zap overrides this value you can't set the value net of VAT in the Item to get the correct amount when VAT is applied.

Importantly, if you want to use SKUs to identify your items when using the Zap, you need to include the SKU under the "Item Name" field, and not the SKU field on the import. This is because there is no SKU field in the Zap action setting up the Invoice, so to link the Item in Zoho Books and the incoming order you will need to set the "Item Name" field in the Zap with your eBay SKU (see below).

Once you've imported your items, head over to Zapier.

 2. Set up Zap: The Zap will consist of the trigger and two actions. The trigger is the eBay order, the first action is to convert the gross sale value to net, and the second is to generate the invoice including this calculated value. Set up your Zap, and for the trigger select eBay, then New Order. Choose your account, then complete and move on to the next action.

 For the first action, select Format, one of the built in tools on the right hand side. This should set the app to Formatter by Zapier. Next select numbers from the event, and for the Transform choose Spreadsheet-Style Formula.

 Because eBay only gives the gross sale price, the formula I used is a simple one to convert this to net for my applicable VAT rate (20%):

=ROUND(1. Line Items Total Value:5.95/1.2,2)

Where "1. Line Items Total Value" is the field with the gross sale price in.

Create a second action, select Zoho Books, and Create New Sales Invoice. Choose your account, and then you'll get to the main set up action page.

Customer name is mandatory, and Zoho will automatically set up the customer in Zoho Books (a customer is needed to generate an invoice). Item Name is also mandatory, and as noted earlier this will need to match the Item Name on the Item in Zoho Books. As I'm using SKUs I mapped the Line Item SKU field to this to match the import, which means Zoho will now automatically apply VAT to the invoice when generated.

Quantity is also required, and should be mapped (Line Items Quantity), and Rate is also required. This is the net sale price generated in the first action, when you click on the field the option "Numbers in Formatter by Zapier" should appear, and in the dropdown the output number should be there.

Once you have set up the rest of the fields, give the Zap a test, and you should now be generating invoices with the correct amount of VAT in Zoho Books.                                                     

As a final thought, I found some rounding errors crept in on multi-item orders with discounts applied using the above method when using the individual item values from a field such as "Line Items Total Value" for the second action VAT calculation, so instead used the "Pricing Summary Total Value" field which just gives the gross total of the order. This messes up the look of the invoice a little (the first item has the entire net value applied to it, the others 0), but gets rid of the error.