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How Do Taxes Work on Squarespace?

Last updated on October 1, 2022 @ 6:55 am

Overview

When you sell products or services through Squarespace Commerce, you’re responsible for collecting and remitting taxes to the appropriate tax authorities. Depending on your business and location, you may need to collect and remit VAT, GST, state sales tax, city sales tax, or other types of taxes. This article provides an overview of how taxes work with Squarespace Commerce.

Configuring taxes

You can configure tax settings from the Commerce > Taxes page of your site’s dashboard. To learn more, visit Configuring taxes.

PRO TIP: If you are thinking about using Squarespace to create a website for your business, be aware that there are some potential tax implications. While Squarespace is easy to use and provides a lot of flexibility when it comes to creating a website, there are some things to keep in mind when it comes to taxes.

For example, if you sell products on your Squarespace website, you will need to collect and remit sales tax to the appropriate state and local taxing authorities. This can be a complex process, so be sure to research the requirements in your state before moving forward.

In addition, if you use Squarespace to host your business website, you may be required to pay taxes on the income you earn from your website. This is typically done through self-employment taxes, and the amount you owe will depend on several factors, including how much income you earn from your website and what state you live in.

While there are some potential tax implications to using Squarespace for your business website, overall it is still a great platform to use. Just be sure to do your research beforehand so you are prepared and compliant with all applicable tax laws.

Calculating taxes

Squarespace Commerce calculates taxes based on the following:

  • The customer’s shipping address. Taxes are calculated based on the customer’s shipping address. If the customer doesn’t provide a shipping address, we’ll use the billing address instead.
  • The product’s taxable status and tax category. You can configure these settings from the Product > Pricing & Discounts page.
  • The site’s tax settings.

    You can configure these settings from the Commerce > Taxes page.

VAT and GST for digital goods

  • If you sell digital goods in the European Union (EU), Norway, Iceland, or Liechtenstein, you may need to collect Value Added Tax (VAT).
  • If you sell digital goods in Australia, New Zealand, or Japan, you may need to collect Goods and Services Tax (GST).

Note: (VAT and GST are similar taxes that are sometimes called by different names.) If you’re registered for VAT or GST in one of these countries, we’ll automatically calculate and add VAT or GST to your customers’ orders at checkout.

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Dale Leydon

Dale Leydon

Sysadmin turned Javascript developer. Owner of 20+ apps graveyard, and a couple of successful ones.