Tax overrides and exemptions

Taxes are calculated automatically within Shopify, but you can override these tax rates for greater control over the taxes that you charge. Use overrides if you need to do any of the following:

• control how much tax you charge for a particular product
• handle tax exceptions and exemptions
• specify unique tax rates for shipping destinations
• specify unique tax rates for tax-exempt customers.

For example, you can specify overrides for state tax exemptions in the United States, provincial tax exemptions in Canada, or VAT exemptions in the European Union or the United Kingdom.

Overrides apply to online sales and to Shopify POS sales.

To set up a tax override,create a manual collectionfor the products that are tax exempt, and thenapply the override to that collection.

If you don't need to charge sales tax, then you can create overrides and set the tax rates to 0%. Always check with a local tax authority to make sure that you are charging your customers the correct tax rates.

Set a product to be exempt from sales tax

If you have just a few products that are exempt from tax, then you can prevent any taxes from applying to these products individually.

Steps:

1. In your Shopify admin, clickProducts, and then click the name of the product.

2. In thePricingsection, uncheckCharge taxes on this product.

3. ClickSave.

Create a manual collection of products that need a tax override

If you have a group of products that all need the same tax override, then you can create a collection that contains the products, and then apply the override to the collection.

You can make tax override collections hidden so that the collection isn't visible to your customers. After you apply a tax override to the collection, any products that you add to the collection will become tax exempt everywhere in your store, whether the collection is hidden or not.

Steps:

1. From your Shopify admin, go toProducts>Collections.

2. ClickCreate collection, and then enter a name for it.

3. UnderCollection type, selectManual

4. If you want to hide the collection from any of your active sales channels, then clickManagein theCollection availabilitysection to deselect the check box beside the name of the sales channel.Learn more about sales channel availability.

5. ClickSave.

6. In theProductssection, clickBrowse.

7. Select the products that you want to add to the collection, and then clickDone.

After you add all the products that need a tax override to the collection, you canapply a tax override to the collection.

Product categories

Product categories are labels that are assigned to products or to collections of products. For merchants that sell to customers in the United States, they indicate the tax obligations and exemptions that customers have when they purchase those particular products.

Using product categories increases the accuracy of US tax calculations, and reduces the need for tax overrides. Product categories are selected from theShopify Product Taxonomy, which is a predefined and standardized list. To learn more, refer toProduct categories.

If you set a product category for a product that has an override in place, then the override takes precedence over product category tax calculations. Consider removing anyproduct tax overridesthat conflict with your product categories. However, if you're aware of tax rules thataren't calculated by product categories, then keep your product tax overrides.

Override the taxes on a collection or on shipping charges

You can specify unique tax rates for a collection of products or on shipping charges.

The percentage value that you enter is the amount thatwill be collected. It'snotthe amount exempted.

Steps:

1. Click the name of the country for which you want to add the tax override.
2. In theTax overridessection, clickAdd a tax override.
3. To add an override for products, clickProductsin theAdd Tax Override forcountrydialog
   1. ClickSelect a collection, and select the collection that needs an override
   2. UnderLocation, select where you want the override to apply.
   3. UnderTax rate, enter the amount of tax that you want to charge for the products in the collection.
   4. ClickAdd Override.
4. To add an override to shipping charges, clickShippingin theAdd Tax Override forcountrydialog.
   1. UnderLocation, select where you want the override to apply.
   2. UnderTax rate, enter the tax rate that you want to apply to the shipping charge.
   3. ClickAdd Override.
5. ClickSave.

Set up tax-exempt customers

On theCustomerspage of your Shopify admin, you can set a customer to be fully tax exempt.

Tax exempt customers are not charged any tax when they complete a checkout. These customers need to check out using the same email address as the one listed on their customer account.

Steps:

1. From your Shopify admin, go toCustomers.

2. Find the customer you want to exempt from all taxes, and then click their name.

3. In theTax settingssection, clickManage.

4. UncheckCollect tax.

5. ClickSave.

Built-in tax exemptions

Shopify has built-in tax overrides for two specific cases:

• US merchants selling clothing in New York, New Jersey, Massachusetts, and Rhode Island
• Canadian merchants selling vapor products in British Columbia and Saskatchewan

Clothing tax rules in US states

The following states have tax exemptions for certain clothing products:

• New York: In some jurisdictions, clothing products, footwear products, and items used to repair clothing products with an individual price under $110 are exempt from state sales tax. For example, two items with a combined price of $200 will each be exempt from sales tax, but one item with an individual price of $110 will be subject to sales tax. This exemption also applies to the local tax rates of the following jurisdictions:
  • Bronx
  • Brooklyn
  • Chautauqua
  • Chenango (except the city of Norwich)
  • Columbia
  • Delaware
  • 达奇斯县
  • Greene
  • Hamilton
  • Manhattan
  • Queens
  • Staten Island
  • Tioga
• New Jerseyf:大多数服装和鞋类产品是免税的rom state sales tax. There are no price limits for this exemption.
• Massachusetts: Clothing products with a price under $175 are exempt from state sales tax, and clothing products with a price of over $175 will collect tax only on the amount that their price is over $175. For example, an item of clothing with a price of $200 will be taxed on $25 because the first $175 is not taxable.
• Rhode Island: Clothing and footwear products with an individual price of $250 or less are exempt from state sales tax, and only the incremental amount above $250 is subject to sales tax. For example, if a suit costs $275, then the tax applies only to $25.

For Shopify to calculate the correct tax rates, your store must be set up to collect sales tax in the state, and you need to create acollectionfor the applicable clothing products with a title oftax:clothing.

Steps:

1. From your Shopify admin, go toProducts>Collections.

2. ClickCreate collection.

3. InTitle, entertax:clothingin lowercase letters.

4. UnderCollection type, selectManual

5. Add products to thecollection manually.

6. Optional: To hide the collection from any of your active sales channels,change the collection's availability.

7. Save your collection.

After you save thetax:clothing收集、适用的服装将是一个规则pplied automatically, and the correct amount of tax will be collected for the products in that collection.

Use thetax:clothingcollection only for the states of New York, Massachusetts, and Rhode Island. If another clothing exemption applies in your jurisdiction, use other tax override methods or mark your products as nontaxable in thePricingsection of the product page.

不列颠哥伦比亚省蒸汽产品税rules

British Columbia applies a higher PST rate to vapor products. In addition, GST is compounded on the PST. For Shopify to calculate the correct tax rates, you need to create acollectionfor the applicable vapor products with the titletax:eliquid_vaporizers.

For more information about the PST rate for vapor products, refer to theGovernment of British Columbiawebsite.

Before you begin

For the override to apply correctly, you need to set up your tax accounts forCanadaandBritish Columbiafirst.

Steps:

1. From your Shopify admin, go toProducts>Collections.

2. ClickCreate collection.

3. InTitle, entertax:eliquid_vaporizersin lowercase letters.

4. UnderCollection type, selectManual

5. Add products to thecollection manually.

6. Optional: To hide the collection from any of your active sales channels,change the collection's availability.

7. Save your collection.

After you save thetax:eliquid_vaporizerscollection, the applicable sales taxes are applied automatically, and the correct amount of tax will be collected for the products in that collection.

Saskatchewan vapor product tax rules

Saskatchewan applies a Vapour Products Tax, orVPT, to vapor products. For Shopify to calculate the correct tax rates, you need to create acollectionfor the applicable vapor products with the titletax:eliquid_vaporizers.

For more information about the VPT for vapor products, refer to theGovernment of Saskatchewanwebsite.

Before you begin

For the override to apply correctly, you need to set up your tax accounts forCanadaandSaskatchewanfirst.

Steps:

1. From your Shopify admin, go toProducts>Collections.

2. ClickCreate collection.

3. InTitle, entertax:eliquid_vaporizersin lowercase letters.

4. UnderCollection type, selectManual

5. Add products to thecollection manually.

6. Optional: To hide the collection from any of your active sales channels,change the collection's availability.

7. Save your collection.

After you save thetax:eliquid_vaporizerscollection, PST is no longer collected on products in the collection, and it is replaced by VST.

Set a 0% tax rate for most of your products

If most or all of your products are exempt from sales tax and you are in a country that has both federal tax and regional taxes, then you can override the defaults to 0% in theBase taxessection.

However, for your products that are taxable, you will need to add those products to a collection, and then create a tax override for that collection.

Steps

1. Click the name of the country for which you want to add the tax override.
2. In theBase taxessection, specify that the regional tax rate isadded to 0% federal tax.
3. In theTax overridessection, clickAdd a tax override.
4. In theAdd Tax Override forcountrydialog, select the collection to apply the tax override to.
5. UnderLocation, specify the country or region the override will apply to.
6. ClickAdd override.