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How does this tax thing really work

New Member
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I am setting up my dropshipping store, but tax appears to be problematic for me and i am hoping someone who is based in the UK and is dropshipping to the UK, Europe and US understands what duties need to be paid if at all any. I know i dont have to charge VAT to my UK and European customers unless my turnover is £85,000 or more after which time i need to register for VAT. But i guess my question is will my customers who buy my clothes in my online store be charged any duties in their respective countries and if so how do i avoid them being charged duties at the door or customs seizing the items? Also do i need to pay any income tax?


I have read all the material on shopify and i dont find answers. I think such a big community here would have the answers as its been done so many times before by this community.


Look forward to hearing from you

Reply 1 (1)
Shopify Staff
Shopify Staff
412 63 81

Hey, Androus!


Ramón from Shopify here.


I understand you needed some clarification in regards to tax settings and international charges for your store. While we're not tax experts and have limited knowledge on international customs fees, I'd be more than happy to point you in the right direction.


Generally speaking, tax and duties charges vary by region, and as a result, can be very different case by case.


When it comes to knowing more about customs and other international fees your customers may have to pay, I suggest reaching out to your dropshipping supplier since they're in charge of sending the products. They'd be more familiar with these types of charges and would know more about what your customers can expect.


On the other hand, when it comes to specific tax charges or regulations, I also recommend contacting an accountant in your region who's familiar with these types of taxes. Their knowledge on taxes would be more extensive, so they'd be able to answer some of these questions for you.


Of course, we also have a community of merchants who are active on our forums who may have had to go through this same process. I did find a previous forum topic here where someone had a similar question and was able to receive some responses, so those may be helpful as well. Hopefully they can also pitch in their feedback here.


I'd also encourage sharing our tax guide with your dropshipping provider and accountant so they can familiarize themselves with how taxes work in Shopify.


Let me know if that helps, and if there was any information you'd like to see added or clarified in our Help Center documentation, I'm more than happy to share this feedback with our team.


Ramón | Social Care @ Shopify 
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