How To Setup Sales Tax In Your Shopify Store (2024) Shopify Tax Setup

how to set up sales tax in your Shopify store hey guys welcome back in this video I'll be showing you how you can get started with setting up sales taxes in your Shopify store so let's get into it now the first thing you need to know whenever you're looking to get started with building your Shopify store is that taxes can be a really important segment and building your taxes is really difficult especially if you're located in the United States the reason for that is because taxes so very it really depends on state to state who you're liable to what kind of tax you're paying so that can be a lot to keep track of and we're going to show you guys exactly how to do that now for most other regions most countries have a standardized tax amount a standardized tax that is the sales tax for some it might be 18% for some it might be 15% whatever it might be so if you are going to apply sales taxes in a different region I would just recommend you can include a certain percentage amount by going into your settings you can go into your taxes and duties and just set up that particular tax amount so you can see charge that charge tax on shipping rates and you can just add those taxes now for the United States it's going to be a little different so if you're looking to set up taxes in a region that has variable taxes you're going to go into your settings on the bottom left once you're in your settings you can scroll down and go into taxes and duties now in taxes and duties you're going to have all of your countries present so within any country you can click on that particular country and then you will have your current tax service so we are currently using Shopify tax and over here you can actually go ahead and see how to collect taxes so you have some basic information like your tax collection tax rates and exemptions and then your liabilities and the states that you're collecting in now obviously for the first section you are going to have to get started with collecting taxes now you do have to register for collection in certain States so if you open up the US uh state area if I'm selling in Hawaii versus Nevada versus um South Carolina all of that is going to have different taxes so over here you can see it has local taxes then depending on the sourcing what kind of tax where I pay so if my warehouse is located in North Dakota then I will have to pay the North Dakota tax on sourcing rather than the Ohio tax however on North Dakota if any product is shipped in North Dakota even if my warehouse is located elsewhere in the United States I would have to pay the destination tax so these rules and laws are going to be a little tricky so you're going to click on start collecting over here and you can start adding the state that you're collecting sales tax in so you will have to do this on your own you're going to add your particular State and then the sales tax ID so when you are going to enter your sales tax ID you can collect sales tax over here obviously this is just a sample ID but you're going to click on collect sales tax and you're just going to open this link of taxes in Alaska and then you will see over here you have local taxes and sourcing taxes and you will see over there that you need to register with the local jurisdictions that you're selling into and charge destination taxes so you guys can see in their sourcing they only tax origin taxing Arizona has a single system for registering and filing taxes and taxpayers are required to file and pay for all tax jurisdictions including the City of Phoenix to the state so you can go on ahead and open up the particular page for tax liability in Arizona this will lead you to the sales tax Institute so you can better understand the taxation laws within that particular state because those are going to be really variable now once you add your particular State you can start adding more so you can click on collect sales tax then you can add the next state that you're in so let's say it's Texas then you're going to add your sales taex ID but even if you don't you can just add your States the ones that you're selling in even if you haven't registered yet now below that you have tax rates and exemptions so your products are going to be subject to a special tax depending on what category they are so you can click on manage categories over here and you can add the categories like this these kinds of products don't have a lot of Taxation variability however other products maybe larger products like Furniture maybe luxury goods those type of items might have variable taxation laws so if you're selling something that's like over $10,000 obviously the taxation laws for that probably will be different because it's going to be luxury good now after that you have some shipping overrides where you can set custom tax rates for shipping destinations so let's say for Texas the tax rate that I'm going to be charging the sales tax is going to be 10% you can add this override manually so if the Shopify help center has not updated any tax laws or if you see any state over here and you feel like as if you're not certain about the tax rate and you find different conflicting information you can always add your shipping overrides then you can also add shipping overrides in the situation that if you are shipping Across the Nation if you're shipping to the other side then you might want to charge a higher tax rate simply because of your shipping cost now you can always add a higher shipping cost to that I don't recommend you actually increase the tax on that but depending on your origin destination you might have to pay more taxes to a particular State now you also have product overrides where you can set custom tax rates for a certain collection of products now this is especially applicable for luxury goods present within your store so if you have any luxury goods that are day-to-day Goods but however are marked as luxury goods so you're going to have to add product overrides for those as well now on the top you guys will see your regions that you're collecting in and then above that you can see and monitor your liability so action required monitoring required no action required you will be able to see all of your tax liabilities whenever you get orders so if I just place my own order over here just to show you guys all products and I'll place a order for this product over here I'll order like 30 of them buy it now like this I will click on complete order and once your order has been processed so once you start receiving orders what you're going to find is you will see this is just a sample order but it has has estimated taxes so the estimated taxes on this particular order was $56 so this is going to automatically add your taxes so the Shopify app will automatically add your taxes and now after that you can go back into your settings and go into your taxes and duties just to take a look at what your taxes are looking like so if I go on back into the United States we can actually see the tax liability that you might have so if you're liable for any kind of tax that you have not given as of yet and you can click on monitor your liability currently we don't have any liabilities required cuz our Shopify application automatically included those taxes so I hope you guys found this video helpful if you did make sure to leave a like And subscribe to our YouTube channel and if you have any questions or queries about taxes Shopify and how you can set up your Shopify store make sure to check out our other videos where we talk about how you can change background customize your code and so much more on Shopify so if you found this helpful make sure to leave a like and I will catch you guys in the next video

Channel: Tech Express

Views: 2,809

Keywords: shopify taxes, shopify, shopify taxes setup, shopify taxes settings, shopify taxes for dropshipping, shopift taxes and shipping calculated at checkout, shopify taxes tutorial, shopify taxes 2023, shopify taxes usa, shopify sales tax usa, shopify sales tax report, shopify sales tax setup, shopify sales tax id, shopify sales tax collection, shopify sales tax nexus, shopify dropshipping sales tax, shopify not charging sales tax

Id: CKXhrvqsrN8

Length: 8min 14sec (494 seconds)

Published: Fri Nov 03 2023