Shopify Tax

Shopify Tax offers the highest level of sales tax compliance with the least amount of upkeep for merchants that sell to customers in the United States. The following features are available when using Shopify Tax:

  • Sales tax liability insights decode each state's tax regulations to help determine where you might be required to collect taxes.
  • Rooftop accuracy uses precise calculation technology to collect tax based on your customer's specific address within 11,000+ US tax jurisdictions. This improvement over zip code-based calculations better captures tax rates that can vary within regions, and helps to prevent additional costs when inaccurate tax calculations occur.
  • Product categories automatically suggests categories for each of your products that you can review, approve, or revise, and then applies the most accurate tax rate for that product based on your customer’s local tax rules.
  • Enhanced sales tax reporting can help to make filing easier by providing filterable sales data, enabling you to generate reports ready to send in to each jurisdiction.

You can also choose one of Shopify’s two free legacy tax services: Basic Tax or Manual Tax. These services offer a lower level of automated compliance, and require significantly more work on your part to keep tax rates up to date and to monitor regulation changes. This could expose your business to more tax liability in US jurisdictions. Learn more about your US tax service options and how to switch.

Shopify Tax is also available for in-person sales through Shopify POS. If you have Shopify Tax activated for your online store, then it will automatically be activated for all of your retail locations. Learn more about setting up taxes on Shopify POS.

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