Does Shopify Collect Income Tax?
When using Shopify to sell your products or services, it’s important to understand the implications of taxes. Shopify helps automate charging sales taxes, but the platform does not remit or file your taxes for you. This article will explain how Shopify works with taxes, and how you can configure your store to charge taxes.
What Does Shopify Do With Taxes?
Shopify helps automate the process of charging sales tax, but does not remit or file taxes for you. This means that Shopify will help you to calculate and charge the appropriate sales tax on orders based on the customer’s location.
Where Am I Responsible For Charging Taxes?
You can use Shopify’s guide to determine where in the United States you may be responsible for charging taxes. This guide will provide information on what states and jurisdictions you may need to charge taxes in.
How Can I Configure My Store to Charge Taxes?
Once you know where you’re liable for tax, you can configure your store to charge taxes accordingly. This can be done through the Tax Settings section of your Shopify store. Here, you can add the tax rates for each jurisdiction you’re responsible for, and configure your store to charge taxes accordingly.
Conclusion
Shopify is an excellent platform for automating the process of charging sales taxes, but it does not remit or file taxes for you. To understand where you may be liable for charging taxes, you can use Shopify’s guide. Once you know where you’re liable for tax, you can configure your store to charge taxes accordingly through the Tax Settings section.