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Sales tax collection and management is one of the most daunting tasks for Shopify store owners. That’s because unlike Amazon, which automatically collects and remits taxes to the tax authorities on behalf of the third-party sellers as it is a marketplace facilitator, Shopify does not collect and remit any sales tax on behalf of the Shopify store owners to the respective state or local government where store owners have an economic nexus. It simply provides store owners with tools and features to help them set up and manage their own sales tax collection.

Shopify merchants are themselves responsible for determining whether they need to collect sales tax and for configuring their Shopify store tax settings accordingly. The Shopify platform only provides the merchants with a built-in tax calculator that allows them to set up tax rates based on their business location and the locations where they have physical or economic nexus.

In addition to the tax calculator, Shopify also offers merchants tax reports to view the sales and tax information for their orders. For instance, for Shopify merchants selling in the United States and using Shopify Tax as a tool to calculate taxes, Shopify offers the United States Sales Tax Report. This report displays a detailed summary of the sales and tax information for Shopify store owners’ orders in the United States. Merchants selling outside the United States can use other tax reports like the Sales Finance Report and the Taxes Finance Report to track sales tax information.

Besides using Shopify’s tax tools, merchants having a Shopify store can also integrate their store with various third-party tax apps and services that can help them automate the process of calculating and collecting sales tax. These apps often provide more advanced features, such as handling tax exemptions, managing tax holidays, and generating tax reports.

If you want to know how to find sales tax collected in Shopify App, then in this article we are going to walk you through the step-by-step process of finding tax-collected information in the Shopify App. We will also explain in detail how you can calculate sales tax using the ‘Orders’ report in the Shopify app.

But before we go ahead, let’s understand how as a merchant you can collect sales tax on Shopify

Sales Tax Collection Settings On Shopify

Once you have determined where you need to charge tax in the United States and have registered with the tax agencies and have your sales tax ID, you can set your Shopify store to automatically manage the tax rates used to calculate taxes on the sales made. You can even set up tax overrides for products that have special tax rates.

To start collecting taxes in Shopify, you need to go to ‘Settings’ and then click ‘Taxes and Duties’. Under ‘Taxes and Duties’, you need to go to the “Manage Sales Tax Collection” section and then click the country or region where you want to sell, say it is ‘United States’ in this case.

In the selected region, click on ‘Collect Sales Tax’ and then click on the state or jurisdiction where you are registered for sales tax. Once you select the state or the region where you are registered for sales tax, go to the “Sales Tax ID” field. In this field, enter your sales tax ID. This way you can start collecting sales tax on Shopify.

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How To Find Sales Tax Collected In Shopify App?

To find how much sales tax liability you have or the amount of sales tax you owe to state jurisdiction, you can access the following reports in your Shopify Admin.

1. United States Sales Tax Report (if you sell in the US)
2. Sales Tax Reports
3. Order Reports
4. Sales Finance Report

Let’s understand where to find sales tax information through these reports and how each of these reports can help you find sales tax collected in Shopify.

1. United States Sales Tax Report (if you sell in the US)

One of the best sales tax tools that Shopify offers to merchants is the United States Sales Tax Report. As a Shopify merchant, you can use this report only if you sell in the United States and use Shopify Tax as the tax calculation tool.

The United States Sales Tax Report gives you a detailed summary of the sales and tax information for your orders in the United States. There are three ways in which you can view this report: country-wise, jurisdiction-wise, and transaction-wise. As mentioned before, it only displays the data for sales that your store made to customers with shipping addresses located in the United States.

At present, the report showcases data starting from June 1, 2023. In case you want to view the data before June 1, 2023, you must use the taxes finance report. Furthermore, the United States Sales Tax Report displays the data for just one month. If you want to view the data for more than one month, you must use the tax finance report. To access the data in the report, you simply need to download a Comma Separated Values (CSV) file.

Note that the default view for the United States Sales Tax Report is the country view. The country view showcases a summary view of sales and taxes collected in each state that you made sales to. However, it does not include the orders that you made through third-party marketplaces such as Amazon. The country or the state view of the United States Sales Tax Report showcases the following items:

  • Destination State is the state where you have made sales
  • Total Net Item Sales refers to total line-item sales from orders destined for a particular state after discounts and returns but excluding shipping.
  • Total Item Tax Amount is the total amount of tax collected on sales excluding taxes collected on shipping. Value in this column is the sum of all tax collected for jurisdictions including the state, county, city, and special tax jurisdictions.
  • Total Shipping refers to the total amount charged for shipping to customers in the state.
  • Total Shipping Tax Amount is the total amount of tax collected on shipping.

Also Read:

How To Set Up Shipping On Shopify?

How To Handle Shopify Tax On Shipping?

Now, when you click on a state in the country view, you are able to see the jurisdiction view that provides a summary of sales and taxes for a specific state. The jurisdiction view showcases a summary of sales and taxes that you have collected in each jurisdiction in a specific state.

Note that a tax jurisdiction is a designated region that imposes a tax with a specific intention. It can be a state, county, city, or special tax jurisdiction. Again, the jurisdiction view of the United States Sales Tax Report does not include orders that you made through third-party marketplaces, such as Amazon.

Furthermore, during a data range that you select for your report, if the tax rate changes in any jurisdiction, then that jurisdiction is listed multiple times in the report. This means that each tax rate is reflected in a separate entry.

The jurisdiction view of the United States Sales tax Report may showcase the following items:

  • Tax Jurisdiction Type refers to the type of tax jurisdiction, i.e., state, county, city, or special tax jurisdiction. State indicates the tax collected for a sale at the State level, county indicates the tax collected for a sale at the county level, City indicates the tax collected for a sale at the city level, and Special Tax Jurisdiction indicates the tax collected for a sale at the specific special tax jurisdiction level.
  • Tax Jurisdiction indicates the name of the jurisdiction.
  • Tax Jurisdiction Code indicates the tax reporting code associated with a tax and the one that defines the tax authority to which taxes are paid.
  • Tax Rate refers to the tax rate charged on applicable sales within that tax jurisdiction.
  • Total Net Item Sales showcases the total line-item sales from orders that had tax collected after discounts and returns, excluding shipping, tax-exempt customer orders, or products exempt from sales tax.
  • Exempt Item Sales displays the total line-item sales that are exempt from tax excluding shipping.
  • Non-Taxable Item Sales showcases the total line-item sales that were non-taxable excluding shipping.
  • Total Exempt/Non-Taxable Item Sales displays the sum of sales that were exempt or non-taxable excluding shipping.
  • Total Taxable Item Sales displays the total line-item sales that were taxable.
  • Total Item Tax Amount showcases the total amount of tax collected from sales excluding taxes collected on shipping.
  • Total Shipping refers to the total amount charged for shipping to customers in the tax jurisdiction.
  • Total Shipping Tax Amount indicates the total amount of tax collected on shipping.

If you want to see the tax data transaction-wise, you must click on ‘View Transactions’ to access the transaction view of your tax data. Now, the transaction view of the United States Sales Tax report showcases detailed data for each transaction. Each line item, including shipping or returns, is displayed in a separate row. Consequently, it is likely that a single order will have several rows associated with it in the transactions view.

Again, the transaction view of the report does not display the orders that were made through third-party marketplaces like Amazon. To view the orders made through third-party marketplaces, you must click the filter button. The transaction view of the United States Sales Tax Report may showcase the following items:

  • Filed By Channel indicates whether taxes have been filed on your behalf by a channel.
  • Channel indicates the name of the channel or app that the customer used to place their order, such as the Online Store or Buy Button.
  • Order Number refers to the order number of the sale.
  • Line-Item ID refers to the line an item displays within an order.
  • Sale Date indicates the date when the order was placed.
  • Line-Item Sales refers to the sales amount for each line item in the order.
  • Discounts refer to the discounts applied to the order.
  • Returns refer to the amount of returns for items in the order.
  • Net Sales indicates the line-item sales less discounts and returns. Shipping is not included.
  • Shipping refers to the shipping value of an order.
  • Total Line-Item Tax Amount indicates the sum of the tax amount for a line item on an order.
  • Exempt Amount refers to the amount of the transaction that is exempt from tax.
  • Non-Taxable Amount indicates the amount of the transaction that is non-taxable.
  • Exempt/Non-Taxable Amount refers to the sum of Exempt and Non-taxable amounts.
  • Tax Rate indicates the tax rate charged for the line item.
  • Tax Amount refers to the amount of tax that was collected on taxable items.
  • Tax Jurisdiction Type indicates a designated region that imposes a tax with a specific intention. This can be a state, city, county, or special tax jurisdiction.
  • Tax Jurisdiction refers to the name of the tax jurisdiction.
  • Tax Jurisdiction Code indicates the code associated with a tax. The jurisdiction code defines the tax authority to which taxes are paid.
  • Tax Jurisdiction County indicates the county where the order was shipped to.
  • Destination City indicates the city where the order was shipped to.
  • Destination State indicates the state where the order was shipped to.
  • Destination Country displays the country where the order was shipped to.
  • Destination Postal Code refers to the postal code to which the order was shipped.
  • Shopify Reference ID indicates the order’s unique ID within Shopify.

Where To Find United States Sales Tax Reports On Shopify?

To view the United States Sales Tax Report on Shopify, follow the steps below:

  • Go to your Shopify Admin. Once you log in to the Admin, go to Analytics and then click on ‘Reports’.
  • Under ‘Reports’, click ‘The United States Sales Tax Report’.
  • This step is an optional one. You can refine your results by adding filters, changing the report date range, or selecting specific columns.
  • If you want to download the CSV file of the report, just click ‘Export’.

Once you locate the report, the next step is to know how to find sales tax collected in Shopify app. To find sales tax liability, you need to prepare an Excel sheet by filtering out the important columns such as Tax Jurisdiction, Tax Jurisdiction Code, Tax Amount, Destination State, Destination Postal Code, Exempt Amount, and Returns. In the third section below, we have discussed how to prepare the Excel Sheet and the Pivot Table for calculating taxes.

Also Read: How To Get Shopify Tax Documents Online?

2. Taxes Finance Report

In case you do not sell in the United States but still want to find out the sales tax collected amount in the Shopify App, you can access the ‘Taxes Finance Report’. The ‘Taxes Finance Report’, also called the ‘Taxes Report’ showcases the sales tax applied to the sales that your store made within the selected timeframe.

Each row within the ‘Taxes Report’ displays a tax type which can be a state tax or a county tax along with the tax rate and the total tax amount charged within the selected timeframe.

The following are the items that the ‘Taxes Report’ displays:

  • Channel displays the marketplace channel in which sales occurred, if any.
  • Country showcases the country of the tax rate. However for origin-based tax jurisdictions, like California, the destination is currently displayed instead of the country to which the tax applies.
  • Region indicates the state or province of the tax rate. However, for origin-based tax jurisdictions, like California, the destination is currently displayed instead of the region to which the tax applies.
  • Name refers to the tax rate name.
  • Rate refers to the tax rate in percentage terms.
  • Filed By Channel indicates the taxes that have been filed on your behalf by a marketplace channel. There can be three possibilities here: Filed, Not Filed, and Unspecified. Filed means the marketplace channel is responsible for filing taxes on your behalf. Not
  • Filed means the marketplace channel is not responsible for filing taxes. Unspecified means that the responsibilities of the marketplace channel could not be determined. You must review these transactions to determine whether the marketplace channel is responsible for filing taxes. In case you did not make a sale on a marketplace, then such a sale will be listed as Not Filed or Unspecified.
  • Amount indicates the amount of sales taxes applied during the selected timeframe.

Also Read: How To Apply Shopify Different Tax Rates?

Note that the ‘Taxes Report’ determines the country and region for taxes based on the destination of sales. Therefore, even for origin-based sales tax jurisdictions like California, the report might include the destination information. Shipping Address is used to determine the destination. In case it is not possible to determine the shipping address, then the tax report may use the billing address. In case it is not possible to determine the billing address, then the tax report may use the POS address.

Once you locate the report, the next step is to know how to find sales tax collected in Shopify app using this report. To find sales tax liability, you need to prepare an Excel sheet by filtering out the important columns such as Region, Rate, and Amount. In the third section below, we have discussed how to prepare the Excel Sheet and the Pivot Table for calculating taxes.

3. Orders Report

Another way through which you can view the sales tax collected in your Shopify app is through the ‘Orders Report’. The Order reports provide you with insights into your order volume, fulfillment, shipping, delivery, and returns.

To find sales tax collected through orders, you simply need to follow the steps below:

1. Log in to your Shopify Admin. Then, click on ‘Orders’ on the left bar menu.

2. Once you click on ‘Orders’, the screen will display the orders that have been made on your Shopify store. The ‘Orders’ page showcases a detailed summary of the orders made on your Shopify store including the amount paid for each order, the taxes against each order, discounts given on each order, shipping charges, shipping taxes, shipping address, shipping province, and so on.

3. To know how much sales tax you have collected, you need to click on the ‘Export’ button on the upper right corner of the ‘Orders’ page and download the orders report in CSV. When you click on the ‘Export’ button, a pop-up will show up that has two sections: Export and Export As. Under the ‘Export’ section, you have various options like Current Page, All Orders, Selected, 50+ Orders Matching Your Search, and Orders By Date. Choose the ‘Orders By Date’ option as this will allow you to download the orders report by date. Depending upon the kind of tax review you are doing, that is monthly, quarterly, or yearly, you can select the date range for the ‘Orders’ report by clicking on the ‘Orders By Date’ option.

4. Then, under the ‘Export As’ section, you have two options: CSV For Excel, Numbers, Or Other Spreadsheet Programs and Plain CSV File. Choose the ‘CSV For Excel, Numbers, Or Other Spreadsheet Programs’ option to download the report.

5. After choosing the relevant options as mentioned in the previous point, you can now click on the ‘Export Orders’ button at the bottom of the pop-up to download the spreadsheet.

Note that once you download the order report, it will be emailed to you. It might take a few minutes to some hours for the report to reach your inbox depending upon the period for which you have exported the data.

Once you receive your report in the email, download the same and open it in Excel.

How To Read The Sales Tax Report?

When you download the report in Excel, you will see a lot of details related to the orders that have been made on your Shopify store.

Some important details related to the sales tax include the following:

1. Name

The name refers to the transaction ID number of the order. You may witness duplicate transaction ID numbers in your sheet. This is because every product that your customer purchases on your Shopify store results in creating a new line item within the order.

Say for instance, that a customer purchases 2 items within the same order, then they will have the same transaction ID number. However, this transaction ID number will reflect 2 times in two separate rows to indicate two separate items that were purchased within the same order.

2. Financial Status

The column financial status refers to the status of the order in terms of payment, that is, whether the payment against the order was made or not. This may seem an unnecessary item, however, it has a key role to play in determining the orders against which the payment was made but due to a problem in the payment method, the payment was not received.

As a result, the financial status of the order shows ‘unpaid’. Now, when the financial status of an order is unpaid, you do not have to collect and remit sales on such orders.

3. Subtotal

Another important column that you need to focus on is the ‘Subtotal’ column in the sales tax report or the order report. This column displays the amount that the customer paid to you for every single product that he or she purchased from your Shopify store.

Note that the amount against each of the products that a customer purchased in an order is net of discount. That is, the discount amount is already subtracted from the original price of the product. The discount amount is displayed in another column in the sheet under the column head ‘Discount Amount’.

4. Total

The column head entitled ‘Total’ is another important column that you need to consider when calculating your sales tax. This column is the sum of the Subtotal, Shipping, and Taxes.

Total = Subtotal + Shipping + Taxes

Here Subtotal = Original Price Of The Product – Discount Amount

5. Shipping

There are a host of columns related to shipping that you must know for determining sales tax nexus and calculating sales tax. For instance, the column entitled ‘Shipping Province’ showcases the state where the sale has been made.

Since most of the states consider sales tax as a destination-based tax (some states consider sales tax as an origin-based tax, so you must go through the tax regulations of a particular state when determining nexus), the rate and calculation of sales tax are based on the location of the buyer or the destination of the goods or services. The tax rate is determined by the local tax jurisdiction where the consumer receives the product or service. Therefore, the column entitled ‘Shipping Province’ is extremely important.

Once you go through all these details, the next step is to know how to find sales tax collected in Shopify App using this report. For this, you need to use a pivot table.

How To Use A Pivot Table To Calculate Sales Tax?

To understand the calculation of sales tax using a pivot table, let’s consider an example. Say, the following is the spreadsheet that we exported from Orders in our Shopify Admin.

A B C D E F
1 Name Email Financial Status Paid At Fulfillment Status Fulfilled At
2 #60450 paid 10/10/2023 4:50 fulfilled 10/14/2023 11:31
3 #60450
4 #60451 paid 10/15/2023 5:23 fulfilled 10/20/2023 11:31
5 #60451

 

G H I J K L M N
1 Accepts Marketing Currency Subtotal Shipping  Taxes Total Discount Code Discount Amount
2 no USD 50.50 2.55 0 53.05
3
4 no USD 215.00 8.00 0 223.00
5

 

The first step in using a pivot table is to add four columns at the beginning of the orders excel spreadsheet that you downloaded from your email. The pivot table will help you to take out the important information that you need regarding sales tax from the entire table.

A B C D E F G H
1 Name Email Financial Status Paid At
2 #60450 paid 10/10/2023 4:50
3 #60450
4 #60451 paid 10/15/2023 5:23
5 #60451

The next step is to label the columns that you add in the beginning of the excel spreadsheet. Put ‘Year’ as a label in the first column, ‘Month’ in the second column, ‘Month Year’ in the third column, and ‘Calculated Order Number’ in the first column.

A B C D E F G H
1 Year Month Month Year Calculated Order Number Name Email Financial Status Paid At
2 #60450 paid 10/10/2023 4:50
3 #60450
4 #60451 paid 10/15/2023 5:23
5 #60451

Note that the calculated order number column will help you calculate the number of transactions that occurred on your Shopify store in a particular state. It is important to calculate the number of transactions that occurred in a particular state for determining sales tax nexus.

Once you have labeled all the columns, the next step is to color the pivot table in order to distinguish it from the rest of the spreadsheet.

Now, the next thing that you have to do is start adding functions in each of the columns. In the first column labeled ‘Year’, you must add the YEAR function so that the ‘Year’ column in the pivot table picks up the year in which a particular order was made from the spreadsheet and displays it in this column. The function that you must use is the year function with a syntax =YEAR(serial_number). The serial_number argument in the YEAR function is the date of the year that we wish to find. In our case, the serial_number will be the column that displays the date when the order was placed.

A B C D E F G H
1 Year Month Month Year Calculated Order Number Name Email Financial Status Paid At
2 =year(H2) #60450 paid 10/10/2023 4:50
3 #60450
4 #60451 paid 10/15/2023 5:23
5 #60451

Note that in the table above, H2 indicates column H and row number 2. Accordingly, cell H2 denotes the ‘Paid At’ date, that is, the day and year on which your customer for transaction ID number #60450 made the payment against the order. Do not type in H2, simply click on the cell H2 while typing in the syntax for the YEAR formula, that is, =year().

Then, next is the Month column. In this column, you must add the MONTH function so that the ‘Month’ column in the pivot table picks up the month in which a particular order was made from the spreadsheet and displays it in this column. The function that you must use is the MONTH function with a syntax =MONTH(serial_number). The serial_number argument in the MONTH function is the month of the year that we wish to find. In our case, the serial_number will be the column that displays the date when the order was placed.

A B C D E F G H
1 Year Month Month Year Calculated Order Number Name Email Financial Status Paid At
2 2023 =month(H2) #60450 paid 10/10/2023 4:50
3 #60450
4 #60451 paid 10/15/2023 5:23
5 #60451

Note that in the table above, H2 indicates column H and row number 2. Accordingly, cell H2 denotes the ‘Paid At’ date, that is, the day and year on which your customer for transaction ID number #60450 made the payment against the order. Do not type in H2, simply click on the cell H2 while typing in the syntax for the MONTH formula, that is, =month().

Next is the Month Year column. In this column, you must concatenate or combine the month and year displayed in columns B and A respectively using the ampersand (&) symbol. The formula that you must use is the B2&“ ”&A2. Note that we have separated B2 (Month) and A2 (Year) with a space by adding a space in between the quotation marks (“ ”).

A B C D E F G H
1 Year Month Month Year Calculated Order Number Name Email Financial Status Paid At
2 2023 10 =B2&“ ”&A2 #60450 paid 10/10/2023 4:50
3 #60450
4 #60451 paid 10/15/2023 5:23
5 #60451

Again, do not type in A2 and B2, simply click on the respective cells while typing in the syntax for the =B2&“ ”&A2.

Next is the Calculated Order Number column. In this column, you must use the IF Function. The formula that you must use is =IF (E2=E1,0, IF(E2=“”,0,1)). This means that if the two consecutive rows, in our case E1 and E2, have the same transaction ID, then the Calculated Order Number value should be 0, otherwise, the answer should be the second half of the IF function and that is IF(E2=“”,0,1). We have used this formula because we do not want the same order number to be counted again.

Note that in the second half of the IF function, we have used another IF function. The meaning of the IF function in the second half IF(E2=“”,0,1) means that if the current cell, E2 in our case is an empty space, then the value should be 0, otherwise the value should be 1. This way we can get the number of unique orders that customers have placed on your store in a given timeframe and help us eliminate the duplicate orders.

A B C D E
1 Year Month Month Year Calculated Order Number Name
2 2023 10 10 2023 =IF (E2=E1,0, if(E2=“”,0,1)) #60450
3 #60450
4 #60451
5 #60451

Once you have applied functions in all four cells, select all the cells A2, B2, C2, and D2, and drag them down so that the formula is applied to all the remaining orders in the pivot table.

Now, to create a pivot table, select the entire table by clicking on the triangle in the top left-hand corner of the table. Once you have selected the entire table, then go to the top taskbar and click on ‘Insert’. When you click on ‘Insert’, you will see that the following options are displayed on the top taskbar in the Tables section: Pivot Table, Recommended Pivot Tables, and Table. Click on the ‘Pivot Table’ option.

Once you click on the ‘Pivot Table’ option, you will see a new screen. On this screen, you will see the pivot table on the left-hand side which is typically blank at the beginning, and on the right-hand side, you will see that the columns from your spreadsheet are listed. This section on the right is labeled as Pivot Table Fields. The Pivot Table Fields section has two different parts to it. The upper part has the search bar along with the list of fields which are nothing but the different column heads of your spreadsheet laid out in the form of a list along with their check boxes. This is the section where you have to choose the fields that you want in your pivot table on the left-hand side.

The next section to the Pivot Table Fields is the bottom part which has four more sections to it namely, Filters, Columns, Rows, and Values. These are the sections where you have to drag the fields from the upper part of the Pivot Table Fields section.

Now you will decide what rows and columns you want to set up and what information you want to filter out. In our example, we have dragged the following fields from the upper part of the Pivot Table Fields section to the lower part sections.

Under Filters, we have considered the following fields:

  • Month Year
  • Financial Status
  • Payment Method
  • Shipping Country

Under Columns, we have considered the summation function that has the symbol 𝚺. This means the columns of the pivot table will showcase the total values of the different fields that we choose.

Under Rows, we have considered the Shipping Province field. This displays the provinces where orders were delivered along with their province initials.

Finally, under Values, we will drag the following fields:

  • Subtotals
  • Shipping
  • Taxes
  • Total
  • Discount Code

All these fields will be displayed as follows in the Values section:

  • Sum of Subtotals
  • Sum of Shipping
  • Sum of Taxes
  • Sum of Total
  • Sum of Discount Code

Now, you can use the filters that you have created to filter out the information that you do not want. For instance, from the Month Year filter, you can simply select the months for which you need to review the data. Then, from the Financial Status filter, you can uncheck the pending financial status as you do not want to review the orders against which the tax was not paid or was pending. Also, you can keep the shipping country as the US for instance if you want to review the amount of taxes that you have collected in different states within the US for a given timeframe.

So, whatever total of taxes and calculated order numbers you get can be used to determine nexus within a state.

4. Sales Finance Report

Another report that can help you find out the sales tax collected in Shopify is the Sales Finance Report. This report provides a summary of each sale and returns that your Shopify store made during a specific timeframe that you have selected for review. Also, the report displays each product as a separate sale or return for the orders having multiple products within the same order. The same goes for the shipping charges. That is, if an order has multiple products, the shipping charges for each product within the same order are showcased separately.

You can organize this report by date, depending upon the timeframe you need for tax review. To view the details of an order, you simply need to click the order number for a particular order you want to view.

The sales finance report displays the following items for each sale or return:

  • Date indicates the date when the sale or return was made on your Shopify store.
  • Order refers to the order that the sale or return is associated with.
  • Product indicates the product that the sale or return is associated with.
  • Gross Sales refers to the product selling price x ordered quantity. It does not include discounts, returns, taxes, or shipping.
  • Discounts refer to the sum, product discount + the product’s proportional share of a cart-wide discount.
  • Returns refer to the value of goods that the customer returned to you as a merchant. Returns display as a negative number on the date that the return occurred.
  • Net Sales refer to gross sales – discounts – returns. It does not include shipping charges or taxes
  • Taxes refer to the taxes associated with a sale or return.
  • Shipping refers to the shipping charges associated with a sale or return.
  • Total Sales refers to the sum, gross sales – discounts – returns + taxes + shipping charges.

You can use this report to cross-check the amount of taxes that you have calculated using the above reports.

Conclusion

As is clear from above, Shopify provides a host of tools for you to determine your sales tax liability. To access these tools, it’s important that you first switch on the tax collecting feature in your Shopify Admin under ‘settings’. Once you properly set up taxes in your Shopify App, Shopify will help you track sales and automatically calculate taxes when you surpass the sales benchmark for sales tax collection in a state.

It’s important for you as a Shopify merchant to make use of correct tax rates and determine sales tax liability depending on the economic nexus that you have with the state. Besides using these tax reports or tools, you should always consult a tax professional to know the correct tax liability and tax status.

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