Taxes - Selling US product in USA via UK reg'd business

Leon_Downer
New Member
1 0 0

Hi All

We operate a UK based and reg'd business. We buy a product from a US based supplier who dropships the products to our US based customers. Therefore we have no physical presence in the US and no physical inventory holding or associated costs. We take the orders and the supplier fulfills 100% of our orders,

Does this mean I am not liable for paying US sales tax?

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Dakota_Monk
Shopify Staff
Shopify Staff
7 0 2

Hi Leon!

My name is Dakota and I am Guru here at Shopify. 

Here is a great article on whether or not you should be charging taxes on your products in the US!

Essentially, 

you only have to collect sales tax in these states if you have what's called “sales tax nexus.” Nexus is established when you have a significant business presence in a state, which can include things like:

  • Having an office
  • Having an employee
  • Having a warehouse
  • Having an affiliate 
  • Storing inventory
  • Dropshipping from a 3rd party provider 
  • Temporarily doing physical business in a state for a limited amount of time, such as at a trade show or craft fair

If you suspect you might have a physical presence in a state, you could check with that state’s taxing authority to determine whether or not you have sales tax nexus.

Hopefully this clarifies things :)

Cheers!

Dakota, Shopify Guru
[Call, Chat or Email us 24/7!](https://docs.shopify.com/support)

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