Taxes and VAT

Taxes decide how much VAT, GST or sales tax is added to a purchase. The calculation runs through Stripe Tax: it looks at the buyer's address and your tax registrations and adds the tax at checkout, so you don't keep rate tables yourself.

Open the payments overview

From there, go to Payments > Settings > Taxes. If Payments is off in your workspace, switch it on under Settings > Features first. Seeing the page takes View Payments, saving changes takes Update Orders / Customers. Tax is calculated on your connected Stripe account, so connect Stripe first.

Turning on Stripe Tax

The Stripe Tax box holds two settings:

• Enable Stripe Tax is on from the start. Turning it on or off asks for confirmation. Stripe charges 0.5% per taxed transaction.
• Origin country is the country your business is registered in for tax. It has no default, so pick it yourself. The list holds a fixed set of countries; a country that is not on it cannot be chosen.

Stripe Tax only calculates once both are set. Until you pick an origin country, the status at the top shows Incomplete and no tax is added at checkout. With both in place it shows Active.

The Setup list next to it shows your progress. The last step, Add tax registrations in Stripe, happens in Stripe itself: Stripe only collects tax where you are registered. Open Stripe Tax dashboard takes you there. Registrations and filing stay your responsibility.

Prices with or without tax

Every price has a Tax included in price switch, which is on by default. On means the amount you entered already contains tax, so the tax is taken out of it and the buyer pays exactly that amount. Off means tax is added on top. Free prices don't show the switch. Shipping costs are taxed the same way as the products in the order.

What the buyer sees

While Stripe Tax is active, the checkout asks for a Billing address, and a purchase cannot be completed without a country. The order summary shows a tax line, for example "Tax (19%, incl.)".

Buyers choose between Personal and Business. Business buyers enter a Company name and, where their country uses one, a tax ID. The field is labeled by type, for example "VAT ID (optional)". EU VAT IDs are checked against the EU register right away:

• "VAT ID verified." means the ID counts. If the reverse charge applies, the tax line shows Reverse charge and no VAT is added.
• If the ID cannot be verified, the buyer can still continue, but VAT is added.
• If the register cannot be reached, VAT is added too, and the buyer is told to try again in a few minutes.

For physical products shipped to a different delivery address, tax follows the delivery address. See Shipping options.

PayPal and offline payments

PayPal and offline payment methods also get their tax from Stripe. While Stripe Tax is active and no Stripe account is connected, these checkouts stop with "Tax calculation is temporarily unavailable. Please try again in a moment." If you sell without Stripe, switch Enable Stripe Tax off. See Offline payment methods.

Orders you create by hand under Sales > Orders get their tax from Stripe Tax in the same way, and their invoice shows it. A reverse charge for business buyers is not applied to them.

Small business scheme

If you are a small business under §19 of the German VAT Act, switch on Enabled in the Small business scheme (§19 UStG) box. No VAT is charged, and every invoice carries the required §19 UStG note. While the scheme is on, Stripe Tax stays inactive even if it is enabled, and the status shows §19 UStG.

Turning tax off

Switching Enable Stripe Tax off asks you to confirm. From then on, no VAT or GST is calculated or shown on new invoices. Invoices you already issued stay unchanged.