Why isn't sales tax being collected on customer orders?

[SweetJulesVegan]

I have Shopify set up to collect sales tax in my state and each product has the “collect sales tax” box checked. When I create a manual order, tax is automatically added in. But when a customer does it on their own through my store, taxes aren’t being added. What’s the deal here? I’ve had a bunch of sales this month and I’m going to have to dish out the tax on my own due to this error.

Any ideas?

[StephensWorld]

My initials thoughts are that one of the following issues are occurring: 

• not all of your products have the 'collect sales tax' box checked within their product settings (note: each individual product variant has it's own checkbox for charging taxes, so for products with multiple variants, you'd need to make sure each variant has taxes enabled). 
• the customers purchasing from your site aren't from the location that you've set up taxes for. 

If you can provide some screenshots of your settings, as well as a link to your store, then I'd be happy to take a look and test your checkout, to see if it's working on my end. 

Also if you could provide a screenshot of an order where taxes should be charged, but aren't being charged (with the customer's name, email, phone, and street address blurred out -- so we only see the product purchased + city/state/country of the order + order totals), then that would also help with troubleshooting the issue. 

[Lcordova37]

I've noticed mine is doing this too. How do I fix this?

[PrestinMyles]

What's also inconsistent about this tax error on Shopify is that All established products are charged tax upon check out. With Custom Draft orders, it simply will not add tax unless you add the state/region of your customer into your Nexus list...

Can anyone please address this!?

[Angie_Stiles]

Hi Stephen, I'm having the same issue as SweetJulesVegan and JadenRose. My partner thinks it's because I have the category set as Apparel & Accessories, and may not be specific enough (ie: Clothing). However, Apparel & Accessories and taxable in Idaho, and my customer's all have Idaho addresses. This has happened on my last 3 stores, and I'm losing so much money by not having the sales tax collected. Can you help? I'm happy to send photos, and any information you need. 

[MariaSSFF]

I believe this is it! I had the same problem where tax collected was checked but not adding it- and I had the category generic Apparel & Accessories. Deleted that and it started adding tax at check out. Will have to see how far down I need to go in the category to make both work!

[DamselflyFlower]

I'm having the same issue with my store. We are in NYC and use Shopify to allow customers to pre-order flower bouquets for pickup. Many of our customers have billing addresses in NJ, MA, PA and are not being taxed at all. It's incredibly frustrating and causing a lot of headaches for our accountant. Is there a workaround??

[Angie_Stiles]

I went to the chat session on Shopify. The initital few messages were clearly from AI, but then I asked to speak to a real person and got one. We messaged on Shopify until I had to leave for an appointment so she offered to continue the conversation via email. She gave me a workaround for my situtation which made absolutely no sense to me at all, but I will just have to research her suggestion the next time I set up a store. For your situation, you may not have to worry about collecting sales tax from other states unless you sell a certain amount of product. I would try the Shopify chat feature and ask for a living agent to help you.

[RealKatieWolfe]

I’m having this smaw issue. Help! It shows tax to me but not when a customer checks out on the exact same item. 

 

[Summer]

Hey, @RealKatieWolfe! Are you based in the US? If so, I recommend reviewing the tax guidelines. Some customers may not be required to pay tax, depending on their location. We have a general guide here, but for the most accurate and tailored advice, I recommend consulting a tax expert.

[COUTURE_BOY]

I got bounced around repeatedly by polite Shopify staff to the point of annoyance but no real assistance in resolving this issue.

[Nafeesa]

I am also having the same issue. 

[lynnfox]

Just helping folks. I'm confused as well and Shopify should have a better experience developed: As a company owner or website designer I need to know that my taxes are not being charged and configured before I hit a threshold so that I'm not panicking that I'm breaking the law.  This should be on the initial taxes section. "For US taxes, [accurate description of expected behavior]"  https://help.shopify.com/en/manual/taxes/us/us-tax-liability#threshold-periods

[Erin]

Hi, there! You can find the most accurate information on how to set up your taxes with Shopify's settings in the Help Center. The page you linked is specifically about US tax liabilities, but if you're looking for a general overview of US taxes with Shopify, this page here will be more helpful. You may also want to take a look over this guide on how to set up your taxes in Shopify. 

Since tax liabilities and obligations vary depending on the specifics of each business and where they're located, we can't share any guidance on your legal obligations. However, we can help review your settings to ensure they work as you expect them to. We can also look into any unexpected issues you're noticing. You can reach out to our support team for help through the Help Center here. We also always recommend speaking to a local tax expert to help you ensure you are collecting taxes correctly for your business.

[COUTURE_BOY]

Having the same issue. Any news from Shopify.com?

[PrestinMyles]

I am with you, Just realized no one is being charged tax out of state... I just spent 2 hours with support trying to figure it out. None of the articles help, the best thing to doo is talk to a tax professional and verify which states you can add to your nexus list. This list is found in your Taxes and Duties tab under Settings. What I found out is that I need to talk with my Tax Advisor (not Shopify) to add each state available for taxation...

[jadenrose]

Having the same problem. My store has charged sales tax before, and now is not. All of the steps mentioned above are correct in my store too. What's happened?

[PrestinMyles]

I am glad I am not the only one experiencing this issue at least... 

[Cmatias]

Anyone found an answer to this?

[anika01]

I did some research because I was having the same issue and the following article helped:

https://help.shopify.com/en/manual/taxes/us

"Nexus, or a connection between your store and a US state, determines whether you potentially have tax liability there. Nexus can be physical or economic."

.."

In a destination state, the general rule is that the sales tax you charge is based on the address of your customer.

• If you have no nexus in the state of the shipping address, then no tax is charged."

Hope this helps!

Anika

[MariaSSFF]

I believe it's the category you have selected (ie Apparel & Accessories for me) was too generic - I deleted the category and it now adds tax on.

[lajuaned]

Yeah this is all so ridiculous that no tax is being charged. No issue with this on Etsy. Everyone is charged tax. I guess we'll have to just tack that on to the price of the items because no way am I taking on that expense when due.

[beauxbreaux]

I see what the issue is and this is something Shopify needs to address on their end. Essentially, they go off the nexus of each state and if you have not met that threshold they do not charge tax unless you have met that states threshold. The reason this is an issue, is that is not exactly how the real world works. Just because a company is making sales on 1 platform does not mean that same company isn't also making money on other flatforms such as 3rd party websites. None of these sales are being accounted for. Then the absolute most important part is that just because as a seller we do not have a tax obligation that does not mean the buyer doesn't have a use tax they must pay. So if you are working with businesses that needs to have an easy paper trail for accounting, this is terrible for them. We need a way to charge taxes regardless of nexus. This needs to change. So to answer your question, you personally are not responsible for paying those taxes if you have not met the nexus in that state. The burden falls to your buyers. This of course is still not a solution but an explanation of why it is happening and why it shouldn't be happening.