Shopify International Taxes and Duties: What to Collect
Shopify international taxes and duties are two separate things. Taxes (sales tax, VAT, GST) are what your store charges under the rules of the places you sell in, and Shopify Tax can calculate them in the United States, European Union, United Kingdom and Canada. Duties and import taxes are what customs charges when a parcel crosses a border, and Shopify can collect an estimate of them at checkout so your customer does not pay on delivery. This is not tax advice; Shopify’s own pages tell you to check rates and filing with a local tax authority or professional.
Taxes versus duties
The Shopify Tax and duties and import taxes pages in the Help Center, read on October 23, 2026, treat the two as separate systems with separate settings and fees.
| Taxes (VAT, GST, sales tax) | Duties and import taxes | |
|---|---|---|
| Charged by | The tax rules of the place you sell to | Customs, on arrival |
| Based on | Where you sell and to whom | The product’s classification, its origin and the destination’s rules |
| Shopify tool | Shopify Tax in the US, EU, UK and Canada; manual rates elsewhere | Collection at checkout, set up under Settings > Taxes and duties |
| Filing | Your responsibility; Shopify Tax automated filing covers US sales tax returns only | Paid at checkout as an estimate, or by the customer on delivery |
Shopify says tax compliance is your responsibility: it calculates taxes but does not file or remit them unless you use automated filing.
Taxes with Shopify Tax
Shopify Tax is free until your store reaches a sales threshold of $100,000 USD in the US and rest of world, €100,000 in the EU, £100,000 in the UK and $100,000 CAD in Canada. Stores created before May 13, 2026, have an annual threshold; newer ones a lifetime threshold. After the threshold the fee per transaction is 0.35% for Basic, Grow or Advanced stores in the US (0.25% on Plus) and 0.25% in the EU, UK and Canada (0.15% on Plus), capped at $0.99 per order. The fee is billed with your subscription, not charged to customers, and applies only in regions where you turned tax collection on. For the EU and UK the Help Center lists VAT invoices, VAT validation in checkout and features specific to those regions; US state rules are in sales tax compliance.
Duties and import taxes at checkout
Customers outside your country can be charged duties and import taxes on arrival. Collecting an estimate at checkout needs three things from the store: shipping labels from a carrier that supports delivered duty paid (DDP) if you use labels, no Shopify Fulfillment Network, and Harmonized System (HS) codes on your products. If you do not meet these, Shopify says a third-party app is the alternative.
- Go to Settings > Taxes and duties. In Duties and import taxes, click Set up.
- Confirm that your carriers and third-party integrations support DDP.
- Select the countries or regions where you want to collect.
- Fix the products Shopify flags as missing an HS code or a country or region of origin.
- Confirm that your store policy and notifications cover international sales.
- Read the terms and click Agree and activate.
You can also set it per market: Markets > the market > Taxes and duties > Collect duties and import tax, where you choose to show duties as a line item or include them in the price, which means you pay them yourself. The transaction fee on every order with duties calculated is 0.5% at the time of reading (a temporary rate set from February 2, 2025, for all merchants); Shopify lists the standard rates as 0.85% with Shopify Payments as the gateway and 1.5% otherwise. Shopify charges no fee on orders to your own country, between EU member states or on abandoned checkouts.
Know the limits before you promise “no surprises”. The amounts are estimates, handling, brokerage and disbursement fees are not included, and extra duties can still be charged for reasons such as a wrong HS code. Collection does not work in the “Rest of world” shipping zone, or with manual tax rates, customer tax exemptions do not apply to duties and import taxes, and you cannot collect only taxes without duties. Tax overrides you set for international sales are overridden by the feature; they still apply to domestic sales. Duties follow the price the customer paid, so check commercial invoices for discounted orders and give free samples a non-zero value.
Customs details every product needs
Shopify builds the customs declaration for an international label from your product and order data, and it will not create the label until each item has:
- an HS code of at least 6 digits (a 10-digit code is fine; Shopify stores it without the dots),
- a country or region of origin, meaning where the item was made,
- a description, quantity, value and weight.
Add the codes on the product page, with the bulk editor or with an inventory CSV, so every later label reuses them. During label purchase, Edit customs information fixes a missing value, and Save shipping info to product details keeps it for the next shipment. The description on the declaration usually comes from the HS code’s standard wording, not your product title, so customs may see a longer, more technical description than the name your customers know. Paperwork, labels and carriers are covered in the shipping and returns hub.
One rule ties the checkout setting to your labels: DDP labels are supported only with Managed Markets and specific carriers. If you collect duties at checkout without either, you have to buy the label outside Shopify or refund the order.
Ways to handle duties
| Option | Who pays and when | Needs from you |
|---|---|---|
| Customer pays on delivery (DAP) | Customer, to the carrier or customs | Nothing at checkout; tell shoppers in your shipping policy |
| Collect at checkout | Customer, as an estimate in the order total | DDP-capable carrier, HS codes, origin country, not Shopify Fulfillment Network |
| Managed Markets (Global-e as merchant of record) | Customer, in the order total | Managed Markets assigns HS codes for you (they cannot be edited) and a default country of origin if you have none; its labels support DDP, and on Grow, Advanced and Plus they include up to $200 USD of shipping insurance |
| Third-party app or service | Depends on the service | Check that it supports DDP and HS codes |
Per country or region you use DAP or DDP, not both.
Take one order: a US store sells a wool sweater to a customer in Germany. With DAP, the checkout shows the price and shipping, and the carrier asks the customer for duties and import VAT at the door. With collection at checkout, the customer sees an estimate as a line item and pays it with the order; your label must then be DDP, from a supported carrier. With duties included in the price, the customer sees one number and you pay the duties out of your margin. With Managed Markets, HS codes and the DDP label are handled for you, and Global-e, Shopify’s partner for the program, becomes the merchant of record for the order. Which of these suits you depends mostly on the order value and how often your parcels cross that border.
For how displayed currencies fit in, see multi-currency. The other store-running guides are in the running a store hub.
Frequently asked questions
Does Shopify file my VAT? Shopify does not file EU or UK VAT for you. Shopify Tax calculates it at checkout, and its automated filing covers US sales tax returns; VAT returns are yours to file, yourself or through an accountant.
What are HS codes? Harmonized System codes classify a product for customs. Shopify uses them to estimate duties at checkout and to build the customs declaration on international labels. A product with no HS code, no description and no category gets an estimate that Shopify itself calls likely to be inaccurate.
Who pays import duties? The customer pays on delivery unless you collect an estimate at checkout, in which case they pay it with the order. With duties included in the price, the cost is yours.