Setting up UK taxes
If you're new to Shopify, then before you start selling, you need to determine whether you should charge tax. You might need to register with various VAT member countries. After that, you can set up your taxes in Shopify to help ensure that you charge the correct rates wherever you sell.
Before you begin setting up UK taxes in Shopify
You need to determine whether you should charge taxes. If you're not sure, then consult with local tax authorities or a tax professional. Typically, you need to register for VAT if you are located in the UK and your sales to customers in the UK are equal to or greater than 85,000 GBP within a 12 month period.
If you intend to sell to countries in the EU, then you might need to register with tax authorities in those regions as a result of Brexit. The process varies depending on where your business is based and where you sell, and on individual government requirements. It's your responsibility to determine where you need to register to charge VAT.
Set up the regions in which you're registered
After you've registered with the VAT member countries and have your VAT number, you can set up your taxes. You only need to perform this task once.
- From the Shopify admin, go to Settings > Taxes.
- In the Tax regions section, beside United Kingdom, click Set up.
- In the VAT on sales within the EU section, click Collect VAT.
- Select a country in which you are registered.
- In VAT number, enter your VAT number. If you have applied for a VAT number but don't yet have one, then leave this field blank. You can update it when you receive your number.
- Click Collect VAT.
- Optional: To add more regions and account numbers, click Start collecting VAT.
After you set up your tax regions, then you can create tax overrides for products where the default tax rates don't apply.