Why isn't my online store collecting tax on US orders?

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My store is online only and based in Canada, I have inputted sales tax number already. However is not collecting tax for my last 2 orders. Both buyers are from US. 


Any help will be appreciated.


Reply 1 (1)

Shopify Staff
2510 229 532

Hi @Shirley893,


Thank you for your question. If you are based in Canada and are selling to customers in the United States, it's likely that you are not required to charge sales taxes to those customers at this time.


You'll want to familiarize yourself with the term "tax nexus" as whether or not you are required to charge sales taxes in a state likely depends on whether or not you have a nexus in that state. A tax nexus can be defined by physical factors, such as having employees, a warehouse, or an office in a state, or it can be defined as an economic one, which is typically dependent on sales and revenue thresholds.


If you and your business are solely based in Canada, meaning you do not have a physical presence in any US state and you do not house inventory there, and if you have only just started selling to US customers, then you likely will not be required to register for sales tax in any state and begin charging sales taxes to your customers there. I'd recommend reading our guide on US tax liabilities to learn more.


As you're selling cross-border, I'd also recommend reviewing our documentation on duties and import taxes to make sure you are exporting goods correctly and efficiently. Please note that while Shopify offers plenty of general guidance on these topics, we'd always recommend you speak with a professional on these matters if you are unsure of your tax and duty obligations as a seller.


I hope this helps but please let me know if you have more questions.

Victor | Social Care @ Shopify 
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