Tax calculation during checkout and after payment

[Shaipm]

Hello,

I need a help, im setting up my store and i noticed that tax calculation is wrong at checkout and in the invoice after payment example: the tax rate supposed to be 15 % but when i added an item thats price as 100 it calculated the tax as 13.25 which was supposed to be 15.

i have attached screen shots, i tried checking tax setting as: All prices include tax. and also i tried both All prices include tax and Include or exclude tax based on your customer's country

but unfortunately all with the same issue, i dont know if i am doing something wrong

Regards,

[Miles]

Hi, @Shaipm!

I'm Miles from the Social Care team at Shopify. Whilst I won't be able to provide information on what tax amount is correct, I can certainly guide you around setting up the tax information.

Setting up taxes is based on tax registrations for the following regions:

• United States
• Canada
• European Union
• United Kingdom
• Norway
• Switzerland
• Australia
• New Zealand

If you’re not based in one of these regions and you need to charge taxes, then taxes are applied at the country or regional level, depending on your local tax laws.

Follow the links in the steps below for more detailed information:

1. If you're running an online store, then set up the countries you will be shipping to.
2. If you're using Shopify POS to sell in person, then set up the tax rates based on your retail locations. The default POS tax rates are based on the geographic location in which your in-person sales take place.
3. Set up the tax rates in the countries and regions to which you will be selling and shipping your products:
   • If you're in the United States, Canada, the European Union, the United Kingdom, Norway, Switzerland, Australia, or New Zealand, which use registration-based taxes, then enter your tax registrations to collect tax.
   • If you're in a region that uses location-based, then use the default values or specify the rates for countries and their regions. In addition, specify whether you will charge taxes on shipping.
4. If you sell digital products, then set up the taxes that apply to these items.
5. Override tax rates or exempt products from taxes where necessary. Any overrides that you set apply to online sales and to Shopify POS sales.
6. As you set up taxes, you can access and review your settings on the Taxes page in your Shopify admin.

If something isn't calculating correctly after following these steps, then you would need to speak to a local tax professional to ensure everything has been set up correctly.

[HowardC]

Great posting was very useful. One question I ask is how do we settle these taxes with the relevant authorities and can I choose only to deliver to certain countries to start with? 

[Miles]

Hi, @Shaipm!

Thanks for your question. Each year you'll be required to lodge your tax with the relevant authorities. This is not something we would assist with, so questions about how to lodge this would need to be directed to your local tax authority. To make it easier, you'll be able to access reporting on the tax you've charged by heading to Analytics > Reports and navigating to the tax reports.

In regards to who you ship to, that is entirely up to you. It's your business so you set the rules on where you ship to. Once you've set up your shipping settings, you'll then be able to navigate to Settings > Taxes to set up your tax as outlined in my post above.

If you have any questions about this, please let me know.