Calculate Order Tax with Your Own Rates

With the tax source Automatic calculation, Profitario calculates the tax of each order from the order total and the rate you saved for the order's country. Use it when your Shopify orders carry no tax or the wrong tax. Example: your prices include 19% VAT, but tax collection is not set up in Shopify, so Shopify reports $0.00 tax and your profit is overstated by the VAT.

Where: In the sidebar: Store settings > Tax & VAT for the tax source, and Tax (under Costs) for the rates per country
Who: Stores whose Shopify orders carry no or wrong tax
Time: About 5 minutes, plus the recalculation
Updates: Changing the tax source recalculates the tax of all existing orders. New rates apply to the orders you choose in the last step

Switch the Tax Source#

There is no Save button: each control is saved when you change it.

Calculation method	Use it when	Formula	Order total $119.00 at 19%
Tax-inclusive (gross down)	Your prices include the tax	total × rate ÷ (100 + rate)	$19.00
Tax-exclusive (net up)	The tax is added on top of the price	total × rate ÷ 100	$22.61

Tax-inclusive (gross down) is the default. The order total is what the customer paid for the order.

Enter Your Rates#

In the sidebar, open Tax and click Add Tax Rates.

In the rate list, the Source column tells you where a rate comes from: Saved is a rate you saved before, Default is a standard VAT or GST rate that Profitario filled in, Manual is one you typed. Check every Default rate against the rate you really charge.

Save & Apply replaces your whole rate list with the countries that are ticked. A country you untick or remove loses its saved rate.

Change or remove a rate later. On the Tax page, Edit or Set Up opens the rate list again. It then starts on Future orders only: select All existing orders if past orders should change too. The bin next to a country removes its rate and recalculates the orders of that country.

Which Rate an Order Gets#

The billing country of the order decides. The rates are looked up in this order:

Order	Rate used
Has a billing country with a saved rate	The rate of the billing country
Has a billing country without a saved rate	The catch-all rate, if you added one
Has no billing country (some express checkouts)	The rate of the shipping country, else the catch-all

The shipping country is only used when the order has no billing country at all. An order billed to France and shipped to Germany uses the French rate.

A country with no rate. Below the rate list, Add catch-all rate adds the row All other countries. Its rate is used for every country that has no rate of its own. Without a catch-all, or with a rate of 0, Profitario calculates no tax for the order. What the order then shows depends on Import tax from Shopify:

Import tax from Shopify	Tax of an order without a rate
On	The tax Shopify reported for the order
Off	$0.00

What Happens Next#

Changing Tax source, Calculation method or Import tax from Shopify recalculates the tax of all existing orders of the store. The window Recalculating reports shows the progress in orders. It closes by itself a few seconds after it has finished.
While the recalculation runs, the controls on the store settings pages are locked.
A large store can take a few minutes. You can close the window and keep working, the recalculation continues.
New orders always use the current setting when they are imported.
Save & Apply on the Tax page recalculates the orders you chose: all existing orders, or the orders from the selected date on. Future orders only recalculates nothing: the rates apply to orders that arrive from now on.
If you apply rates while a recalculation runs, you see A recalculation is already running for this shop and the window shows the running one.
Removing a rate recalculates the orders of that country. Removing the catch-all recalculates all orders.

Limits#

One rate per country. A different rate per product, per region or state, or per customer type is not possible. For US sales tax by state, use the Shopify tax: see Use the Tax Charged in Shopify.
The rate is applied to the whole order total. Shipping or single products cannot be taxed differently.
Rates have no start date. To use a new rate from a certain day, save it and select From a specific date in the last step.
Future orders only leaves existing orders as they are only until the next full recalculation. Changing Tax source or Calculation method later applies your saved rates to all orders.
One Calculation method for the whole store.
Refunded tax is always the tax Shopify reports on the refund, not a calculated amount. See How Order Tax Affects Your Profit.

Troubleshooting#

The Tax row shows $0.00. Check these in order:

Check	Fix
Automatic calculation without saved rates	Open Tax and click Add Tax Rates
Rates were saved with Future orders only	Open the rate list again and apply it to All existing orders
The recalculation is still running	Wait until Recalculating reports has finished, then reload the dashboard

Add Tax Rates is greyed out. The tax source is Shopify reported. Click Tax settings and set Tax source to Automatic calculation.

A country is missing in the list. The list is built from the billing country of your orders. Use Add a country... in the rate list to add any other country.

If the tax of an order still looks wrong, contact support and send the store name, the order number, the tax you expect and the tax source you use.