Sales tax - Selling from Japan to overseas customers

Jacky121
New Member
1 0 0

Hi!

 

We are planning to start an online store to sell snack and noodles from Japan to international customers. 

We'll register the business in Japan, and we've buyers from the US, Canada, UK, and major countries in Europe.

 

We're a little bit confused what would be the sales tax liability in this situation.

For example:

  • Say the product price is $50 including tax.
  • A US customer purchase the product.
  • Would the sales tax be based on Japan's tax, or US tax? Would we file the sale tax in Japan?

 

Reply 1 (1)
Nick
Community Moderator
4258 422 886

Hi @Jacky121,

 

These are really great questions, taxes can be difficult to navigate even on the best of days. 

 

The first thing I would recommend you to do is to speak to a local tax official or accountant in your region to see which taxes you need to pay or might be liable for. I did recently write a US sales tax FAQ which might provide some more information for the US sales tax side of things, but outside of that, I am not completely sure. There's a section for international stores outside the US and how they might be liable: 

 

19-22-11743-18712

With regards to Canadian and UK sales tax liability for international merchants, I recommend doing some research and speaking to your local tax official. I can't stress that enough. Shopify also has a guide for setting up taxes for stores based out of Japan which can be seen below: 

Hopefully this helps and answers your question. How's the rest of your store set up going?

Nick | Community Moderator @Shopify 

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