Explained: How To Automatically CalculateSales Tax at Checkout on Squarespace
About this Squarespace video tutorial
If you run a successful business through your Squarespace website, you may need to figure out how to collect sales tax on purchases made through your website. Today, we'll cover how to use TaxJar, which comes with some new Squarespace plans, to set up your business to successfully collect sales tax on purchases.
Timestamps
0:00 - Introduction/Disclaimer
2:05 - Eligibility for TaxJar/Connecting to Your Plan
3:32 - Where to Collect Sales Tax
4:48 - What Is Nexus/Where Do You Have Nexus
5:46 - TaxJar & Sales Tax Filing Frequency
7:25 - Resources & Next Steps
Want 20% off your new Squarespace subscription?
Subscribe to the Designing the Row® email list and get the exclusive code sent straight to your inbox. You’ll get email updates when new Squarespace tutorials are published, but you can unsubscribe at any time.
Disclaimer
This video is available as a resource, but should not be construed or relied upon in any way as legal or tax accounting advice. If you have questions about collecting taxes, you can consult with a tax advisor.
If you want to…
Automatically calculates sales tax at checkout based on your customer’s shipping or billing address.
Sell products in the United States. You'll need to be located in the United States and sell in the US to use this feature. If you sell outside the US, you can set manual tax rates for international orders.
Don’t want to manually set up tax rates
Want to save time filing state sales and local taxes
Worry about missing due dates for filing taxes
Want to avoid errors when collecting sales tax
Want help determining if your sales are approaching the economic nexus threshold in each state.
Squarespace Plan Requirements
TaxJar's automatic tax rates feature is free if your on a Core, Plus, Advanced, Commerce Basic, or Commerce Advanced plan. If you're on the Basic or Business plan, you can upgrade your website subscription. If you stay on the Basic or Business plan, you'll need to sign up for TaxJar's Professional plan and connect the TaxJar extension through the Extensions panel.
Where should I collect sales tax?
You should collect sales tax in states where you have business locations, also called nexus. This includes states where you have a physical location, and possibly other states where you make sales, depending on the local laws. To learn more, contact a tax professional. You might also find TaxJar’s documentation helpful.
What is nexus?
You don't need to register to collect sales taxes from customers in every state. You'll only collect sales taxes from customers who live in the states where you have nexus.
"Nexus" is a specific type of connection to a state that's significant enough for you to be required to comply with that state's sales tax laws.
How do I know where I have nexus?
You'll always have nexus in your home state where you are located. The most common causes for nexus in other states are:
Offices
Employees
A warehouse
An affiliate
Stored inventory
Temporarily doing physical business in a state for a trade show or craft fair
Does TaxJar help me register for state sales tax licenses?
If you have nexus in a state, you would want to register for a license to begin collecting sales taxes from customers in that state. For $299 per state, the TaxJar team will register in states where you have met nexus thresholds and need to collect sales tax from customers.
TaxJar will need to know your sales tax filing frequency in every state
Some states want you to file sales tax monthly, others want you to file quarterly, annually or even semi-annually. Your state gives you this information at the time you receive your sales tax permit.
Resources & Next Steps
On demand via Squarespace webinar: Setting up shipping and taxes for Squarespace Commerce
Squarespace Support: Setting Up Automatic Tax Rates in the US
Learn More
If you want to know more about how Squarespace handles payments, you can check out my full tutorial on Squarespace Payments to help set up your business through the platform!
The latest Designing the Row tutorials…
