Hey good people,
We have build our store using shopify and we sell a video communication hardware device called HELLO. We have people buying our device from all over the world. Now lets assume our warehouse is located in LA. Now someone from LA and someone from Germany buy our product. Now, do we charge taxes on the person who is located in LA and bought our device? Same with the person from Germany, do we charge taxes for him/her?
As I understood, taxes are charged only on the people who are from the same state (country) where the warehouse is located? So in the above example the person from LA has to pay taxes while the person from Germany does not? Am I right or not ?
I am completely new to taxes so I would appriciate any help on this matter.
Dave here from the Guru Team :)
Yes you're 100% correct the taxes that are paid are only applicable to the physical location you're selling from. This is why someone purchasing from Germany would not pay tax. This is where the Country's own customs tax would come through which the customer would have to pay themselves. A lot of the taxes with Shopify are fully automated, this guide has more information on Shopify and the way it's taxes work.
We aren't experts on local taxes however so whenever we discuss taxes I'd always recommend consulting your local council for the hard line of what's expected with taxes in your area. If there are any extras that Shopify has not catered for already you can accommodate for this by using tax overrides and exceptions to make sure you're fully comlpiant.
I hope this helps!
All the Best,
Dave | Shopify