Please Help! how do I enter taxes?

Solved
pjmmpls
Excursionist
38 0 76

I just realized my site is not collecting taxes for everyone. I am really confused if I need to manually enter the tax base for all the states or should shopify automatically add it in if I indicated taxes are to be collected? the person I spoke (virtually) to just sent me a link to a page I read and didn't understand which was why I contacted them! I did a POS in two states and it seems to collect taxes from people purchasing on line from there, but even then it  is inconsistent. Thanks for any advice. Pam

Accepted Solution (1)

Accepted Solutions
shayOwensby
Shopify Expert
169 40 89

This is an accepted solution.

@pjmmpls @rainbowblueshop 

 

It's hard to answer without having a look at how your store is currently setup. However, Shopify has great documentation revolving around this subject. I would recommend reading through this: https://help.shopify.com/en/manual/taxes Also, please make sure you click the text links because there is a TON of information throughout the documentation. 

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Replies 24 (24)
shayOwensby
Shopify Expert
169 40 89

Hello, 

 

You can manually set taxes or have it automatically calculate taxes. 

 

To modify your tax settings go to Settings > Taxes. From there you will click on the "Tax Region" you want to edit and will be sent to another screen where you will enter your physical store locations. At the top of the page, you will see a checkbox to automatically calculate taxes. That page will be what you need. If you have multiple regions, make sure to comb through all of your regions. 

 

Please let me know if you have any questions. 

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Likes are appreciated as well 🙂
pjmmpls
Excursionist
38 0 76
Hi! thank you so much for responding. However, I lost you after Tax
regions... this is what I see. Someone else whom I am no longer working
with set it up this far for me and I assumed it was right.
[image: image.png]
shayOwensby
Shopify Expert
169 40 89

@pjmmpls 

 

The image did not attach to your last message. Once you're in Settings > Taxes.... Next to Tax Regions there will either be a setup or edit button there. If you click into that, you can set your tax rates for that specific region. Then, you will just need to do that for all regions of which you ship to. 

 

Screen Shot 2019-08-29 at 4.49.47 PM.png

 

Screen Shot 2019-08-29 at 4.50.23 PM.png

Did I provide you with a working solution? Give me an Approved Solution!

Likes are appreciated as well 🙂
rainbowblueshop
New Member
1 0 0

I am reading this string and do not see my answer to the same question. 

 

I have (calculate taxes automatically checked), I have each product checked to collect taxes, none of the customers are exempt, and Shopify did not collect the sales tax when an item sold.  

My physical presence is Florida-Lee County; I added this in and it does show it correctly.

 

With this said, the sale did not include the sales tax to customers in Arkansas and New Jersey.   

What am I doing wrong??

 

Thank you !!

 

 

shayOwensby
Shopify Expert
169 40 89

This is an accepted solution.

@pjmmpls @rainbowblueshop 

 

It's hard to answer without having a look at how your store is currently setup. However, Shopify has great documentation revolving around this subject. I would recommend reading through this: https://help.shopify.com/en/manual/taxes Also, please make sure you click the text links because there is a TON of information throughout the documentation. 

Did I provide you with a working solution? Give me an Approved Solution!

Likes are appreciated as well 🙂
Upondeck
New Member
1 0 1

Hi,

 

If I sell my products all over the United States, I will have to enter each state and county for sales taxes? How Shopify auotmate this step for store owners who sell their products all over? 

kjpartners
Excursionist
20 0 1

Hi,

 

I'm going through this very issue currently and after a very long Shopify Guru chat, I'm waiting to hear what a "billing team" has to offer as a solution. Currently there isn't even a place to specify a destination state that should have taxes collected! And the help instructions tell you to change certain settings that I can't even find on my Taxes dashboard...  Of course, if Shopify collected taxes for every state that requires it, sends it along with the proceeds of an order we would simply remit it as required. Ideally, they would have a tax table that they would maintain as new states raised their hand to say they now require taxes to be collected to and we wouldn't have to worry about whether we were personally knowledgeable about these things on top of all the other things going on with our businesses. I know that the list of destination states requiring taxes is growing all the time.

 

I fully expect that this list will grow and grow until all states and territories are ultimately in it and, if Shopify isn't going to keep track for us, it would sure be nice if they at least provided a way to manually specify a state ourselves. It isn't ideal but at least it would protect us when it's time to file taxes -- which of course varies by state and could be monthly, quarterly or annually... Would be nice to have a partner who did the most basic activity of at least collecting the taxes and giving them to us so we can pay them as they're paid on each order. Otherwise, I'm assuming we will have to pay out of our own pockets and I surely can't afford to do that...

 

When I get an answer from Shopify I will post here so you will know what can be done as well.

 

Best,

Jo-Lynn

evernessince
Tourist
6 0 0

I too would like an answer to this question.  Given that a majority of states now require out of state sellers to collect sales tax on as little as 100 transactions, it would be nice to know that at the very least we can select which states we need to collect tax in.  Although to be honest I don't think states should have such low transaction requirements to begin with.

MIWellness
New Member
2 0 1

Has anyone found a solution to this yet? I just had an order from TX and NO SALES tax was paid! I have the automatically collect taxes box checked. Shouldn't shopify automatically calculate the tax then? PLEASE HELP! THANKS!

MIWellness
New Member
2 0 1

Ok, I unchecked automatically calculate tax and set the default rate for EACH state. Shopify put in the tax rate for each state. Fingers crossed this works. 

Katherine_Olive
Tourist
6 0 3

I don't think this is a complete solution as you will most likely be on the hook for city and county taxes on top of each state's base rate. I would suggest consulting a tax pro on this, however most seem unprepared to deal with Wayfair. No doubt, Shopify has severely dropped the ball here by not offering the functionality to shop admins to make this easier. For example, I have my shop configured to automatically collect sales tax in my home state of WA, but I need to enter *every* zip code for a state where I have no physical presence but do have economic nexus? Seriously, Shopify...step it up. Of course I think they are happy to force us to buy (and receive their cut) additional apps to handle even this basic need for remote sellers.

Donohue
Shopify Staff
Shopify Staff
69 1 11

Hi Jo-Lynn,

This is really good feedback!

It's a challenge for us to know what your liability might be, but the current tax settings do let you specify where in each state you want to collect. 

We're working on improvements here, and will take your feedback into account to make this simpler than our current setup that requires you to enter a zipcode for each state you wish to charge taxes in. 

Donohue | Product Manager @ Shopify 
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Donohue
Shopify Staff
Shopify Staff
69 1 11

I don't think this is a complete solution as you will most likely be on the hook for city and county taxes on top of each state's base rate. I would suggest consulting a tax pro on this, however most seem unprepared to deal with Wayfair. No doubt, Shopify has severely dropped the ball here by not offering the functionality to shop admins to make this easier. For example, I have my shop configured to automatically collect sales tax in my home state of WA, but I need to enter *every* zip code for a state where I have no physical presence but do have economic nexus? Seriously, Shopify...step it up. Of course I think they are happy to force us to buy (and receive their cut) additional apps to handle even this basic need for remote sellers.

 

Hi Katherine,

Thanks for your feedback. I feel you, and I agree with you. This is something we're working on improving. Keep an eye open here in the Community as we'll be soon providing an opportunity to preview what we've been working on, and have your feedback help guide the improvements we're making.

Thanks!


Donohue | Product Manager @ Shopify 
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Katherine_Olive
Tourist
6 0 3

When? The Wayfair decision was in June 2018 so it's been at least 18 months with no clear support for remote sellers with economic nexus by the Shopify platform.

Katherine_Olive
Tourist
6 0 3

Entering a zip code for states where we have economic nexus only works for destination states. If it is an origin state then the shop needs to enter every zip code in that state in order to trick the cart into calculating the correct municipality rates for the customer.

oscargama
Tourist
3 0 1

I agree! I sell in other platforms and they collect the taxes for us and send them to the respective states. 

Shopify is the largest platform right now. They should have a better understanding that this is a huge issue for sellers and try to find a quick solution. 

I started collecting taxes this year but I only use one zip code for each State. My question is. what happens next. I'ave had sales where I collected taxes in Washington and san francisco. what happens next?? do i need to send the taxes myself to each state??? or is shopify sending the taxes for me? how does it work? 

Donohue
Shopify Staff
Shopify Staff
69 1 11

I agree! I sell in other platforms and they collect the taxes for us and send them to the respective states. 

Shopify is the largest platform right now. They should have a better understanding that this is a huge issue for sellers and try to find a quick solution. 

I started collecting taxes this year but I only use one zip code for each State. My question is. what happens next. I'ave had sales where I collected taxes in Washington and san francisco. what happens next?? do i need to send the taxes myself to each state??? or is shopify sending the taxes for me? how does it work?

 

Hey Oscar, thanks for the feedback. 

Something worth clarifying is that Shopify works a little bit different than those other platforms. Platforms like Amazon, or eBay, or Etsy are the seller of record for transactions through those marketplaces. This means, you have a B2B transaction with the platform for your items, and they then sell it to the buyer via the marketplace. These are called marketplace facilitators. 

Shopify is different, in that your store is your store - we just power it, but you handle the transaction and the contract of sale between you and the buyer. We cannot collect and remit sales tax on your behalf as the contract is between you and the buyer, and you're responsible for the sales tax. Think of the service Shopify offers today as similar to the landlord you rent your business from, rather than a marketplace you sell your products via.

If you know you have nexus in the states you mentioned, you will need to register and remit the sales tax. You shouldn't be collecting sales tax in states that you do not have nexus in. We're also working with some of our experts in the accounting and taxes realm to provide services to help you determine your nexus liabilities and where you should charge taxes. We don't have insight into your entire business outside of Shopify, and because we're not the merchant of record as we're not a marketplace, we cannot just collect and remit on your behalf. We also cannot just make assumptions and charge taxes without you telling us where you're liable, because it's also not proper to collect taxes you should not be collecting.

That said, this is all very valuable feedback - it's interesting to know there's an appetite for this to be something that's taken care of on your behalf, and while I can't promise the current behaviour will change it's still something that could be an input into our future direction. It's an interesting problem for us to solve, and I can understand how much confusion and pain it causes. 

 

 

Donohue | Product Manager @ Shopify 
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Donohue
Shopify Staff
Shopify Staff
69 1 11

Entering a zip code for states where we have economic nexus only works for destination states. If it is an origin state then the shop needs to enter every zip code in that state in order to trick the cart into calculating the correct municipality rates for the customer.

This is a good point, and it's not ideal or intuitive the way it's configured today. 

That said, in Origin states, unless you have a physical location or other place of business, it's likely that you should be charging the destination rate in those states anyway - especially in cases where the product is being shipped into the state from out of state. This is known as an interstate transaction. 

Where this doesn't work, is if you're shipping intrastate (inside the same state, if it's an origin state) - you're then correct, you'll need to currently add multiple zipcodes.

 

 

Donohue | Product Manager @ Shopify 
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LunarBrownie
Tourist
15 0 0

I have a whole different can of worms along the same issue that I can't seem to find an answer. I already pay full sales tax for my products. When I sell I am getting a reimbursement. I need a flat rate tax for all areas shipped to. I can not figure how to make the taxes area do this. I have read every file I can find. Changing state taxes would be lying as I am not collecting individual tax from each state.