USA Business selling internationally tax implications

Tourist
9 0 2

We're based in USA and want to start selling internationally. If we add clear messaging that customer is responsible for duties and taxes, are we responsible to report/collect any other type of "sales tax" or VAT or equivalent?

Thanks!

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Shopify Staff
Shopify Staff
41 0 4

Hey there.

This is Brendan from the Shopify Support team.

Generally speaking, you're not required to collect taxes from customers outside of your home state unless you have "Nexus", or business operations in another location. 

For international and out of state orders, your customers won't be subject to sales tax, just the orders placed within your home state. Shopify does collect taxes for these orders automatically based on the zip code you enter in the Settings > Taxes section of your Shopify Admin. 

We have a help document that covers this topic in greater detail here, and there's a great article on how tax nexus works in the US from TaxJar here.

Does this help? If you have more questions please let me know. 

Best,

Brendan

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New Member
2 0 1

I am really confused. I understand the nexus. However, when I applied for my Business Number with Canada, they made it clear that I was supposed to remit taxes to them as a US business for anything sold to Canadians once my worldwide sales are over $30k. 

So are we supposed to charge or not because at this point I am really really confused...

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Highlighted
New Member
3 0 0

hello Lola_King,

 

thank for that small piece of information." if we are under the $30k CAD then we are not obligated from the sales tax collection (GST) " is that right 

then what about PST and HST??

 

thank u

 

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