Shopify Shipping billing
Shopify Shipping labels and label price adjustments are charged to the credit card that's on file for your Shopify account. All Shopify Shipping charges are billed in USD. If your business is in Canada, Australia, France, or the United Kingdom, then shipping label prices are shown in your local currency when you purchase the label, but the charge on your invoice is in USD.
Shipping label charges
Shipping label invoices are based on threshold billing. This means that as soon as you spend a certain amount on shipping labels within your billing cycle, you are invoiced and charged immediately. While you wait for the payment to be processed, you can continue to purchase labels until you reach 10% of your current threshold. After the invoice is processed, your threshold is reset.
If you don't reach this threshold within your billing cycle, then the shipping label charges are added to your monthly Shopify subscription bill.
For more information on how your specific account is billed for shipping labels, contact Shopify Support.
Find your shipping label charges
You can view your shipping label charges in the Bills section of your Billing page in your Shopify admin.
Shipping label refunds
Any refunds issued for shipping labels are added as a shipping label credit to your account. Credits are applied to future shipping label purchases.
Price adjustments
A shipping label price adjustment occurs when you purchase a shipping label and the shipping carrier determines that you've provided inaccurate information that results in an incorrect shipping label price. After you ship your order, the correct shipping label price is verified by the shipping carrier. If you paid an incorrect amount to ship the order, then your carrier credits or debits you the difference. Your package might still be delivered when there is an adjustment.
Price adjustments are a standard industry practice and most shipping carriers follow this standard. To avoid price adjustments, verify that you are entering the correct information when you are purchasing a shipping label.
Due to shipping carrier processing times, it's not uncommon for there to be a delay between when you purchase the shipping label and when you receive the charge or credit for a price adjustment.
In this section:
- Reasons for price adjustments
- Over maximum limit adjustments
- Avoiding adjustments
- Questions about adjustments
Reasons for price adjustments
If your carrier determines that your shipment needs a price adjustment, then the adjustment appears in the order's timeline. You'll receive a charge or credit to your Shopify account, which will appear on your next bill.
The following examples are possible reasons for price adjustments:
- The package weight specified on the label doesn't match the actual weight of shipment.
- The package dimensions specified on the label don't match the actual dimensions of shipment.
- A flat rate label is used with a weight-based rate box, or a weight-based rate label is used with a flat rate box.
- The specified mail class is incorrect. For example, the packaging weight is above the maximum threshold for that mail class.
- The shipment isn't fully encased in a cardboard box. For example, the shipment is encased in an irregular material, such as metal, wood, hard plastic, soft plastic, or expanded polystyrene foam.
- The content of your package doesn't fit mail class restrictions.
- The carrier charged a fee for preparing your shipment or non-customs documentation.
- The carrier changed the return to sender fees.
If you have questions about a price adjustment, or think that a price adjustment was wrongfully applied, you can find out who to contact in questions about adjustments.
Over maximum limit adjustments
Carriers have maximum package sizes and weights. If a shipment is larger than the maximum size or weight, they can charge you substantial fees.
For example, if you are using UPS and your package weighs more than 150 pounds then you can be charged more than $875.00 USD for being over their weight limit. You can also be charged fees if the package dimensions exceed the carrier's limits. The UPS site has information about their Over Maximum Limits.
Avoiding adjustments
You can avoid overpaying or underpaying for your shipping labels by making sure that your shipping and product settings are accurate.
There are a few things you can do to make your shipping labels more accurate:
- Weigh the item that you're shipping and enter the weight into its product details page.
- Measure and weigh your packaging.
- Make sure that your shipping origin and shipping destination zones are correct.
- If your carrier uses dimensional rates, then configure your default package dimensions.
- Review your carrier's mail classes to make sure your shipment is classified properly.
Questions about adjustments
Shipping label price adjustments are determined by your carrier.
Review the following table to learn who to contact with questions about shipping fee adjustments.
| Shipping carrier | Who to contact |
|---|---|
| USPS | Contact Shopify Support |
| Canada Post | Contact Canada Post |
| Sendle | Contact Sendle |
| UPS | Contact Shopify Support |
| DHL | Contact Shopify Support |
| Hermes | Contact Shopify Support |
| Colissimo | Contact Shopify Support |
Taxes on shipping labels
Each country has different tax rules for shipping labels. Review the tax rules for the country where you ship products from.
If you ship to the EU, then you can register to collect VAT at checkout on certain orders so that customers in the EU don't need to pay taxes upon delivery.
United States
Effective May 21, 2021, the following states charge taxes for shipping labels:
- Arizona
- District of Columbia
- Hawaii
- New Mexico
- West Virginia
Canada
Canada Post charges taxes on domestic and international shipments. Taxes aren't included in the cost of the shipping label at the time of purchase in your Shopify admin. Taxes are added to your invoice together with the shipping label purchase when you're billed. To learn the specific tax percentages, refer to Taxes on Canada Post products.
Australia
Australian domestic shipping labels are taxable, but international shipping labels aren't. However, you don't pay tax if you meet all the following conditions:
- You have an Australian Business Number (ABN).
- You have registered for Australian GST.
- You have added your ABN to your Shopify account.
United Kingdom
No taxes are charged on Shopify Shipping labels purchased in the United Kingdom.
France
No taxes are charged on Shopify Shipping labels purchased in France.
Collecting VAT at checkout for customers in the European Union
As of July 1, 2021, you can collect VAT at checkout from your customers in the European Union (EU), instead of your customers paying taxes upon delivery of their order.
If you're outside the EU and you want your Shopify store to collect VAT at checkout, then you need an Import One-Stop Shop (IOSS) scheme, also called a Non-Union OSS, and to add your IOSS number to your Shopify admin.
Before you begin
Review the following considerations and requirements for collecting VAT through IOSS:
- Businesses outside the EU that ship to customers in the EU aren't required to collect VAT at checkout.
- Review the IOSS EU tax reference to understand when you can collect VAT.
- You need to apply for IOSS through an EU country member. After you receive your IOSS number, you need to add it to your tax registration in your Shopify admin.
- Before you can add your IOSS number to your Shopify admin, you need to set up a shipping profile for the EU.
Add your IOSS number in your Shopify admin
- From the Shopify admin, go to Settings > Taxes and duties.
- In the Tax regions section, beside European Union, click Manage.
- In the Shipping to the EU section, next to VAT on sales to the EU, click Collect VAT.
- From Registration country, select the country where you registered for IOSS.
- In IOSS VAT number, type your IOSS number.
- Click Collect VAT.