Paying Taxes without VAT in UK

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marcmurphydeu
New Member
1 0 0

Hi! I have started my first shopify store but I am not sure about the taxes part of it all. I am currently living in the UK and I sell my products to the US, UK, Spain, United Emirates and Italy. I have not registered for a VAT number as I have only just started and barely making sales. Do I have to "include tax" on all my products? Or can I not include any tax? This is very important for me since I calculate my costs at a 20% profit margin so if the tax is 30%, I am at a loss. Thank you very much.

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Victor
Shopify Staff
Shopify Staff
778 66 191

This is an accepted solution.

Hi @marcmurphydeu,

What you need to determine is whether you are required to register for VAT/ sales tax into the countries you are selling to, and that will inform you whether or not you need to charge your customers sales tax on their orders. In the UK, for example, you do not need to register for VAT until you meet (or are approaching) the taxable turnover threshold of £85,000 set by HMRC, mean you likely will not need to collect and remit sales taxes for orders in the UK whilst you are just starting out. 

For the other countries you are selling into, you will want to do your own research and determine if you need to collect and pay sales taxes—I know in the USA, for example, you likely will not need to if you have no physical presence or tax nexus in any state—and you can set up the collection of taxes for each country in Settings > Taxes. I'd recommend checking out this blog article on TaxJar.com which goes into more detail about charging VAT in the UK and European Union.

If you are still unsure about your tax obligations in each country you are selling to after doing your own research, you may wish to consult a tax professional who should be able to confirm this for you. There is a lot of information that can be found online, however, so you'll be able to inform yourself of your obligations to some degree by seeking out information on tax and small business websites and blogs.

Kind regards,

Victor | Shopify Social Care

Victor | Social Care @ Shopify 
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BiancaBlake
Tourist
18 0 2

We assist U.S. companies with VAT registration and all VAT services needed for selling in the UK and EU. Victor how can I get in touch with someone at Shopify to share our information? We have been in business 25+ years and have a ton of relevant VAT information on our website. We are also sending an "ecommerce new VAT rules" newsletter next week. Who do I talk to at Shopify please? Thank you! Bianca at Euro VAT Refund

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Victor
Shopify Staff
Shopify Staff
778 66 191

Hi @BiancaBlake,

Thank you for getting in touch. From the information you have given, I would recommend considering the Shopify Partner program. Our Partners work with our merchants in a variety of ways, from app development to offering their expertise for a variety of services, and they can go on to become Shopify Experts if they have a proven track record of assisting Shopify merchants. I'd recommend checking out our Partners FAQ for more information.

Kind regards,

Victor | Shopify Social Care

Victor | Social Care @ Shopify 
 - Was my reply helpful? Click Like to let me know! 
 - Was your question answered? Mark it as an Accepted Solution
 - To learn more visit the Shopify Help Center or the Shopify Blog

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