How should I set up taxes and duties in Shopify settings?

There is a video within the 'Business Fundamentals' cheat sheet where tax settings are advised. Although the Shopify interface may look different now from when the video was initially recorded, the principles still apply for selecting the correct settings.

If you are not VAT registered, it is advised that you do not select - 'All prices include tax' and 'Charge tax on shipping rates'. This means that you are telling Shopify that the price that you set your products at on your product page does not include any VAT. 

There will be no tax added onto this price at checkout.

When you become VAT registered, you can then go back into these Shopify tax settings to tick both boxes and inform Shopify that taxes will now be included in your prices.

When VAT registered you will also want to add you VAT number into your Shopify tax settings menu. This is done by editing your United Kingdom region within the 'Manage sales tax collection' section.

Click 'collect VAT', enter your GB VAT number and then Shopify will know that 20% of your product prices will be VAT.

If you have your own reasons for selecting different options then that is completely up to you. This is just the personal preference and advice of the team at Dropship Unlocked who are not tax professionals.

When Uploading a Product

Before you are a VAT registered company - you should untick the box that says 'taxes included on this product'.

You can do this to all products on your store at once by selecting all products and clicking 'bulk edit'.

Then, when you become VAT registered, you can bulk change all products to tick the box to say that taxes are now included for all products (unless you're in a niche where there are different tax rules).