As an online business owner, it’s important to know whether or not you need to collect taxes on your Shopify store. Depending on your business location and the products you sell, you may be required to collect taxes from your customers.
In the United States, for example, businesses are required to collect sales tax in states where they have a physical presence, such as a brick-and-mortar store or warehouse. Businesses that sell digital products, such as e-books or software, may also be required to collect taxes in some states. If you’re not sure whether or not you need to collect taxes, we recommend talking to a tax professional.
If you are located in the United States, you will need to collect sales tax on your orders unless your customer is located in a state that does not have a sales tax. If you are located outside of the United States, you will not need to collect sales tax on your orders unless your customer is located in the United States.
It is important to note that even if you are not required to collect sales tax on your orders, your customers may still be responsible for paying taxes on their purchase. They may be able to claim a refund from their local tax authority if they are charged taxes on their purchase.
In Canada, businesses are required to charge GST/HST on all orders shipped to Canadian addresses. If you’re located in Quebec, you’ll also need to charge QST. You can learn more about charging taxes in Canada on Shopify’s support site.
Outside of the United States and Canada, the rules for collecting taxes vary from country to country. We recommend talking to a tax advisor in your country to find out if you need to collect taxes on your Shopify store.
The bottom line is that whether or not you need to collect taxes on your Shopify store depends on your business location and the products you sell. If you’re unsure about whether or not you need to collect taxes, we recommend talking to a tax professional.
