Honestly.. I am coming from Etsy and this is a whole new ballpark so please bare with me if I sound ignorant. I am in Indiana and I make wax melts and sell a bunch on Etsy, so I was wanting to start my own website, everything is good except, I am not sure what to do for sales tax. I know they go ahead and charge it, but what do I do after that? Do I have to report quarterly or can I just do it when its tax time? And do I need to have every state listed under the tax and duties Sales Tax Collection, or just my state I am based in? I am only selling within the USA.
Thank you in advance.
Hi, @tcassidy7 ,
Welcome to Shopify! We’re so excited to have you. I’m happy to share some more information about taxes on your online store. There’s a few different things I want to share so I’ll include headers to make things easier.
Where to charge tax
In the United States, whether you need to charge tax in a certain state/region is based on nexus. Nexus is a connection between your business and a state, whether physical or economic. If you have nexus in a particular state, then you probably need to charge sales taxes there. I’m unable to provide tax advice and if you were unsure about where you need to collect tax, you would need to contact a tax professional. To learn more about nexus, you can check out this help document! You can also read over our US taxes reference document which has more information, as well as a section on taxes in Indiana.
How to charge taxes on Shopify
Once you’ve determined where you need to charge taxes and you have a sales tax ID for those regions, you will need to set that up in your Shopify admin. You can find the exact steps in this help document. Please note that once you set up your tax registration, Shopify will calculate and charge taxes on all applicable orders, but we will not remit your taxes for you.
When/how often to report taxes
I won’t be able to provide you any advice on this, however, I found these two third-party guides that I thought you’d find helpful:
Finally, if you need assistance with setting up your sales tax, you have the option of hiring a Shopify Expert who specializes in US sales tax. They’ll be able to help you determine your tax liabilities, and set up the taxes in your admin. They’re available for hire at a variety of different price points. You can read more and browse the experts here:
I hope this information helps, and please let me know if you have any more questions! Once again, welcome to Shopify 