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Does Shopify Collect Sales Tax on Orders?

Learn if Shopify collects sales tax on customer orders and understand your tax responsibilities as a merchant
Updated 26 days ago

Does Shopify Collect Sales Tax on Orders?

Short answer: Not by default, with one exception. For orders placed directly through your Shopify store, you're responsible for collecting and remitting sales tax. Shopify gives you the tools to calculate it; it doesn't file or pay it for you. The one exception is orders placed through the SHOP APP, which Shopify handles end to end on your behalf.

Your Store vs. the SHOP APP

Your Shopify store (web, POS, other channels)

SHOP APP orders

Who calculates tax?

You configure it (or use Shopify Tax)

Shopify

Who collects it at checkout?

You

Shopify

Who remits/files it?

You

Shopify, automatic since Jan 1, 2025 for orders shipping to or within the US, reported under SC Commerce Services Inc.

Shows up in Kintsugi as

A regular taxable order

A marketplace order. Kintsugi doesn't calculate tax on these, since Shopify already has

If most of your volume runs through the SHOP APP, you may have less manual tax work than you'd expect, but it's worth confirming which channel each order actually came through, since the two are treated very differently.

What Shopify Does Give You

Shopify's built-in Shopify Tax engine calculates rates automatically at checkout based on product category and destination, and keeps rates updated as laws change. It's a genuinely useful tool, but it stops at calculation. Registering with tax authorities, remitting what's collected, and filing returns are still on you (unless you're specifically using Shopify Tax's automated filing, where available).

How this Connects to Your Kintsugi Integration

Kintsugi's Shopify integration is currently read-only. That means Kintsugi can pull in your Shopify order and tax data to help with reporting, monitoring, and filing, but it can't change your tax settings inside Shopify.

In practice, this means:

  • You're responsible for confirming tax collection is switched on in Shopify for every state where you're registered.

  • You're responsible for keeping product tax categories accurate in Shopify so tax calculates correctly at checkout.

  • Kintsugi will reflect whatever Shopify has calculated and collected, so if Shopify's settings are off, that will show up in your Kintsugi reports too.

If you ever notice a mismatch between what Kintsugi shows as collected tax and what you expect, the first place to check is your Shopify tax settings, not Kintsugi.

Set Up Tax Collection in Shopify

Ready to turn on or check your tax collection? Shopify's own guide walks through it step by step, with a video walkthrough:

Check the reference here: Setting up US taxes, Shopify Help Center (including a video walkthrough)

Quick Guide:

  1. Register with the tax authority in each state where you have nexus (physical or economic). Kintsugi can help identify these states if you're not sure.

  2. In Shopify admin, go to Settings > Taxes and duties > United States.

  3. Under Regional settings, click Add new state, select the state, and enter your sales tax ID.

  4. Click Collect taxes.

Already using Shopify? Use Manage your US taxes instead to review your existing settings and tax liability insights.

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Need Help?

Most Shopify tax setup questions are answered in the guide above. If you've checked your Shopify tax settings and still see a mismatch between collected and calculated tax, click the chat bubble in the bottom right corner. Our team can take a closer look at your account.

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