Re: Regarding taxation of shipping charges

Why are some shipping charges taxed even when not enabled?

mar0717
Tourist
12 0 1

I haven't enabled taxing shipping charges on the tax settings screen, but some orders have been taxed on shipping charges.
Why is this?
My guess is that some US states will be taxed automatically even if they aren't enabled. Is that correct?

Reply 1 (1)

Helen
Shopify Staff (Retired)
1425 174 289

Hey, @mar0717. That is correct! In some regions, it’s required that taxes be charged on shipping. For stores located in Canada, the United States, the European Union, or the United Kingdom that use automatic tax calculations, these charges are automatically applied to your shipping costs. (For stores outside of these areas, the steps for enabling tax collection on shipping are found here).

 

We have an extensive collection of Help Docs that are specifically about US Taxes; I recommend reading through them. Additionally, if you’ve spoken to a tax professional and they’ve advised that you are not required to collect taxes on shipping rates for certain regions, it’s possible to set up a shipping tax override.

 

Hope this helps! If you have any other questions or concerns, just let me know.

To learn more visit the Shopify Help Center or the Community Blog.