Why is my UK store tax rate calculated as 16% instead of 20%?

[Emilie88]

I hope someone can help me. We have a UK store and our taxes should be 20%, but Shopify is calculating at 16%. I've checked the settings and everything is set to the UK as far as I can see. Anyone else had this problem? Thanks, Emilie.

[Victor]

Hi @Emilie88,

Thanks for reaching out with your question. When you head to Settings > Taxes and click on the UK, do you see a rate of 20% appear here? When you go to checkout, are you using a UK address before the tax rate is generated?

Kind regards,

Victor | Shopify Social Care