The instructions under the section called Set up the regions which you are registered seem to be incorrect, here is the link: https://help.shopify.com/en/manual/taxes/us/us-tax-setup
It says to click on a Tax Registrations section in the Taxes tab, but there is NO Tax Registrations section that is is referring to. WHAT AM I MISSING?
Seriously, I've been going around in circles ALL DAY today trying to figure out how to set it up so that I can charge tax on orders from customers in Kansas (where apparently EVERYONE in the US has Nexus if you sell to customers there) and yes, I already purchased the TaxJar app, which is beautiful but it does NOT have a magical button to allow me to change how I charge tax.
Come on Shopify, if you're really listening to your shop owners, you would have done SOMETHING about this by now!
It's not as simple as just entering a zip code for a state, because each state has HUNDREDS of zip codes!
Anyone have any suggestions on where to find the Tax Registrations section of the Shopify Online (NOT Plus)?
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I don't really have an answer to this problem, but I have had the same experience regarding sales tax.
This has got to be something that Shopify can fix. My QuickBooks Online charges the correct sales tax.
I had a Sales Tax Audit 2 years ago and believe me, in California, they don't play games. Shopify is undercharging tax, except if I ship to someone in my sales tax area.
This needs to be handled.
The entire sales tax situation is confusing and California is even more confusing because they are the ONLY state that has Modified Origin status instead of Destination vs Origin state rule. I've heard those Tax Audits are pretty bad too so I feel for you. Thankfully I figured out I need to do this and I've only been in this since February but still, it's frustrating to spend ALL DAY trying to figure it out. I also have QuickBooks but I just don't know if I have the patience to figure it out. As great as Shopify seems, everything seems to need an app to solve it which means fewer profits. I can't believe sellers have actually said they won't sell in Kansas because they don't want to have to pay the sales tax there.
Shopify recently updated their sales tax calculation engine so there are two different ways to set-up tax if you are on a standard Shopify plan (and not on Shopify plus). You should contact support to see if they can upgrade you to the new plan. As a sales tax consultant, I would also caution you to getting a permit in Kansas if you have immaterial sales. Their AG made a letter saying their current $1 threshold is unenforceable. They have a more appropriate economic nexus bill in progress.
- Alex from TaxValet
This is an accepted solution.
I contacted Shopify Support who put me on the list to request from Tax Support to have the Tax Registration option made active in my store, and after 3 days, I heard back from them and they activated it! IT IS AMAZING! of course, I have to register as a business in every state that I would have nexus with (right now that is Texas because that's where I'm located and Kansas because they require you to collect and pay tax for any transaction, no minimum threshold for them!). I had already registered with Kansas and had a tax ID with them, i entered it in the system and BOOM it now collects sales tax for customers in Kansas based on their location, AMAZING!!
I was considering re-platforming because of this issue and this has MADE ME STAY! (Yes, I will overlook the cumbersome process to use PayPal and the fact that I have to use an app for almost everything else I want to do).
So, if you are concerned about Nexus and tax collecting for other states, CONTACT SUPPORT and request to have them switch on Tax Registration for your store! (Honestly don't understand why they don't just make that standard for US shops but oh well).
Thank you Alex, I did contact support and they were able to help me get this corrected. I saw your caution about Kansas but have decided to go ahead with registering there because it didn't cost anything and since there is no minimum right now, I am technically liable for taxes on sales to customers there. I'm sure they will be happy to receive my $5 a year in tax payment and this way it's already set up for the future.